MOM urges condo owners to exercise restraint in activating penalty clauses during Covid-19 period

CONDO owners and management corporations (MCST) should exercise restraint in activating penalty clauses during the Covid-19 period, said the Ministry of Manpower (MOM) and tripartite partners.

The Covid-19 pandemic has disrupted managing agents' (MA) and facility management companies' (FMC) service delivery to MCSTs and building owners across Singapore, the MOM and its partners said in an advisory on Thursday.

"Service buyers, service providers and workers have been adversely affected. Close cooperation among all stakeholders is needed to ensure the sustainability of the strata management and facility management (FM) sectors, the advisory said.

MA and FM services generally require workers to be on-site, and these service providers have been affected by the tightening of the number of workers able to do so, it said.

Therefore, MCSTs and building owners play a critical role in supporting operational changes that will enable MAs and FMCs to meet their expectations, while retaining their resident workers and continuing to develop their capabilities, it said.

"Company policies and business-as-usual mindsets should be revised for the long-term viability of the sector. The focus should be on greater efficiency and better quality of service with no compromise on employee welfare. A new norm of landscape maintenance practices will be expected."

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MCSTs and building owners should pay MAs and FMCs according to contract terms unless there are changes in services required, it said.

The tripartite partners are aware that there are suggestions by MCSTs and building owners for their MAs and FMCs to pass on to them partially or wholly the payouts received under the Jobs Support Scheme (JSS).

"MCSTs and building owners should not ask for reduced contract fees simply because their MAs and FMCs receive wage support through the JSS. JSS is intended to help enterprises retain their local employees during this period of economic uncertainty," it said.

MAs and FMCs, among other service providers, are not regarded as labour suppliers that should pass JSS payouts to their clients, it added.

Labour suppliers function like an external recruitment arm of their clients. Typically, they are only responsible for providing manpower to their clients and have no further responsibilities to provide professional management services.

The situation is different with outsourced service providers such as MAs and FMCs that contract with service buyers and MCSTs. Service buyers typically do not have direct control over the employment and deployment of specific workers.

"As the key decisions on worker employment rests with the MAs and FMCs, the JSS payouts should be retained by them to help meet their obligations to workers and to support local employment. This same principle also applies to government-owned properties which are being outsourced and managed and maintained by the MAs or FMCs. The government agencies do not expect a refund for the JSS payout from their MAs and FMCs," it said.

During the pandemic, MAs and FMCs also incur other additional costs in complying with the safe management measures as well as other related cost to keep their staff motivated in this very trying time, which may not be charged to the MCSTs and building owners, it said.

"We understand that residents in developments managed by MCSTs could also be affected by the economic uncertainty. If there is a change in contract terms, MAs/FMCs and MCSTs/building owners should negotiate the new terms based on the new deployment and requirement.

"MCSTs and building owners should exercise flexibility with service contract clauses during this Covid-19 period. In particular, contract clauses on liquidated damages should not be imposed on MAs and FMCs for breaches that are beyond the MAs and FMCs' control," it said.

MAs and FMCs should remunerate workers appropriately. For workers with heavier workloads, which may be due to additional deployment to new work areas or insufficient headcount, MAs and FMCs should consider increasing their wages, and/or providing them with additional allowances, the advisory added.

For workers with reduced workloads (eg due to health or decreased service provision required), MAs and FMCs should comply with the advisories related to salary and leave arrangements, including taking into consideration government support to retain and continue to pay their employees, even during periods of reduced business activity, it said.

The MOM and tripartite partners also issued an advisory on ensuring the sustainability of the landscape sector. This includes adopting Covid-safe measures applicable to the landscape sector, such as safe accommodation and safe transport.

"The nature of landscape work requires employees to be outdoors. Service buyers should ensure that workers are given enough rest to minimise fatigue-related accidents/incidents and heat-related disorders. They should be provided with suitable personal protective equipment and taught how to use them correctly.

In addition, cleaning/disinfecting agents (eg sanitisers) should be provided, and employees should be reminded to practise good personal hygiene at all times. Workers should have access to proper and reasonable rest areas in or near their work premises.

"As adjustments to work processes and work teams will be required, service buyers should similarly adjust their expectations. This will help ensure that employees are kept safe at work, and landscape companies are not put at risk of flouting safe management measures," it said.

They should prioritise landscape maintenance works that are essential to maintain public safety and health should continue. This includes tree inspections, pruning, removal of fallen and diseased trees, pruning of vegetation that may obstruct traffic and road and rail related structures, basic park maintenance to remove hazards and maintain hygiene, grass cutting, watering to mitigate drought conditions, stock management and maintenance of ornamental nurseries.

"Private properties, which are self-regulated or managed by management councils, should review the landscape maintenance frequency at lower priority areas."

Redistribution of work from lower to higher priority areas helps to manage the workload of landscape workers consistent with their normal scope of duties, while maintaining service levels. In general, service buyers should consider exercising their discretion to provide additional payments to service providers and landscape workers where more services have been rendered.

"Should the need to redeploy employees to other worksites arise, service providers should do so responsibly and on reasonable terms. They should engage their unions and affected employees prior to any redeployment or adjustments to their job scopes."