CPF arrears: $378m recovered last year

More employers were hauled to court by the Central Provident Fund (CPF) Board last year for failing to pay CPF arrears.

A total of 257 employers were convicted, up from 217 in 2013, as the board stepped up enforcement and public awareness.

"We are starting to see the fruits of our labour," said Mr Ng Hock Keong, the board's group director of employer collections and enforcement, referring to the WorkRight campaign started three years ago to raise awareness of employment rights.

The blitz against recalcitrant employers led to a recovery of $378.2 million last year.

These are bosses who underpaid their workers' CPF contributions, did not pay them or paid them late, the board said in a statement yesterday.

The sum was down slightly from the record $420 million in 2013, which came on the back of $293 million in 2012.

The bulk of this year's sum, $364.2 million, was recovered on behalf of more than 279,000 workers from companies that made CPF contributions late - after the 14th of the following month.

An average of 4,300 employers a month, or 3 per cent of the total, are late with CPF contributions.

Another $14 million was recovered on behalf of more than 9,300 employees who had not received their employers' contributions at all or had received less than what they were entitled to.

Bad practices are typically brought to light through complaints by workers or audits and inspections by the board.

For instance, the board recovered over $770,000 in CPF arrears from a beauty services company last year after investigating 11 complaints made against it in 2012 and 2013.

The company had underpaid its employees' CPF and deducted its share of contributions on basic salary from the employees' commissions.

The CPF Board did not name the company as it has since paid up the money it owed.

The penalties for flouting the CPF Act were stiffened last year as a deterrent, with the maximum fine doubled for first-time offenders.

They now face a fine of up to $5,000, a jail term of up to six months, or both.

Repeat offenders may be fined up to $10,000, jailed for up to a year, or both.

The convictions last year led to fines totalling $768,000, up from $550,200 in 2013.

One repeat offender who faced a $12,000 total fine on six charges last year after being convicted for the third consecutive year was Mr Lim A Tiang, the sole proprietor of motor workshop Kangtan in Ang Mo Kio.

When The Straits Times visited the workshop yesterday, a man who identified himself only as Mr Tan and as a friend of the owner said the company had gone bankrupt and was supposed to pay around $16,000 for four months' CPF contributions to seven or eight workers.

"He just coughed up $50,000 to restart the business. He will pay up by next month and it should be fine," said Mr Tan.


This article was first published on April 29, 2015.
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