Labour law changes balance needs of workers and firms

PHOTO: Labour law changes balance needs of workers and firms

Firms and unionists say the latest changes to Singapore's main labour law represent a need to strike a balance between protecting workers and helping businesses cope with rising costs.

But they might find it difficult to bridge their differences in two areas: payslips and overtime pay.

Small businesses welcome the Manpower Ministry's decision to hold off making payslips compulsory.

"We definitely want to comply with the law, but we really need time to adjust," said Madam Chia Sai Im, chairman of the People's Park Traders Association which represents 200 hawkers and shop owners.

She added that most of her association members face mounting cost pressures from rent hikes and labour wages.

But labour MP Zainal Sapari said that he was disappointed with the decision and pledged to continue pushing for early implementation.

"The small and medium-sized enterprises might have exaggerated their difficulties in issuing payslips."

On Tuesday, Parliament updated the Employment Act to give more protection to 450,000 workers.

Some 150,000 more rank-and- file workers will come under the Act after the monthly salary cap is raised to $2,500 from $2,000, while 300,000 professionals earning up to $4,500 monthly will be protected in the areas of unfair dismissal and sick leave benefits, both of which they were not entitled to previously.

Besides payslips, the other concession that firms won is the base for overtime pay calculations. For example, a worker earning $2,500 per month will have his overtime pay calculated from a base of $2,250. Previously, a worker who earned $2,000 monthly would have his overtime pay calculated from his salary.

Said human resource consultant Martin Gabriel: "More workers will now be entitled to overtime pay, but some among them will have their overtime pay capped."

Labour MP Patrick Tay said that unions "pushed very hard" for the differentiation between the calculation base and salary to be removed but settled for a "negotiated outcome". The base will still go up as median salary rises in future, he added.

Trading firm Federal International (2000)'s group human resource manager Tina Ng said her firm discourages working overtime. But if its workers are required to do so, it will still use the lower base for overtime pay calculations and compensate staff through variable payments such as bonuses.

At least one firm said that it will not use the lower base to calculate what its workers earn for overtime work. "It does not feel right," said Mr Low Cheong Kee, managing director of hardware chain Home-Fix.

One worker who will soon come under the Employment Act is Mr Roger Lee, an executive at security firm Soverus.

The 63-year-old earns $2,300 each month and is already receiving benefits such as paid hospitalisation leave that his employer will be required by law to provide from next April.

"I am happy that more workers will come under the law," said Mr Lee, adding: "But what is more important is to have employers who are already giving or willing to do more than what the law says they must do."

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