197,000 lower-wage workers to benefit from Progressive Wage requirements from Sep 1

THE new progressive wage moves that kick in on Thursday (Sep 1) are expected to benefit 197,000 full-time, lower-wage workers, the Ministry of Manpower (MOM) has said.

From Thursday, companies which employ foreign workers must pay all full-time local workers at least the local qualifying salary (LQS) of S$1,400.

The 159,000 full-time, lower-wage workers who are not in Progressive Wage Model (PWM) sectors will benefit from this, in that their wages will not slip below S$1,400. Part-time local workers will need to be paid at least S$9 in gross wages hourly.

Some 19,000 full-time, lower-wage retail workers will benefit from the PWM for the retail sector, which aims to lift their wages, enhance their training opportunities and improve their productivity. The entry-level PWM wage will rise 18 per cent over 3 years.

The MOM also said in its statement that the PWM for the cleaning, security and landscape sectors will be extended to include in-house workers. It applies only to outsourced workers at the moment. This means those employed in-house by hotels, facility management firms, food-services firms and other businesses have to be paid at least the PWM wage corresponding to their job roles. About 19,000 full-time lower-wage workers will benefit from this.

These were part of the broader set of Progressive Wage moves unveiled by the Tripartite Workgroup on Lower-Wage Workers last year.

From September 2022 to February 2023, tripartite partners will work on education employers on the various requirements; employers will be given time to adjust and comply, the MOM said.

The government is co-funding the wage increases via the 5-year Progressive Wage Credit Scheme, which will run until 2026. Co-funding support for 2022 wage increases was recently boosted from 50 per cent to 75 per cent for wages up to S$2,500, and from 30 per cent to 45 per cent for wages above S$2,500, up to S$3,000.

"Employers are urged to use this period of support from the government to accelerate firm-level productivity improvements, so that the wage increases remain sustainable for employers in the long run," the MOM added.

KEYWORDS IN THIS ARTICLE

READ MORE

BT is now on Telegram!

For daily updates on weekdays and specially selected content for the weekend. Subscribe to t.me/BizTimes