With the economic slowdown and small and medium-sized enterprises (SMEs) not doing as well as before, there is a need for the Government to review how operationally ready national servicemen are paid.
Under the Enlistment Act, when an NSman is away from work performing reservist duties, his employer is required to continue paying Central Provident Fund contributions based on his usual civilian remuneration.
In letting the NSman attend to his obligations, his company has to make alternative arrangements, such as employing additional staff to perform the work during his absence. This means more time, effort and budget need to be allocated.
When times are good, companies may not feel the pinch, but today, with many businesses downsizing their manpower and operating expenses, it is akin to financially penalising them for supporting their employees' national service.
While NSmen certainly play an important role, it is only fair that the Government pays all the NSman's remuneration during his reservist duties, including the employer CPF contribution.
We need to recognise that companies support our national defence policy by letting their staff attend to their obligations rather than asking them to defer. Most also contribute to nation building with their annual corporate taxes.
Policymakers need to understand the challenges that SMEs face today, and consider paying the employer CPF contribution for NSmen on reservist duties.
Delane Lim Zi Xuan
This article was first published on Dec 27, 2016.
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