Labour woes' easing a boon for SMEs

A new scheme targeting small and medium-sized enterprises (SMEs) comes as a boon for companies and business associations whose restructuring plans were hobbled by the foreign worker quota.

The Lean Enterprise Development (LED) scheme, announced last Wednesday by Manpower Minister Lim Swee Say, will give some businesses short-term help in hiring and retaining foreign workers by easing up on how the Ministry of Manpower (MOM) applies the foreign worker quota and ratios.

This new flexibility will benefit SMEs such as laundry business Systematic Laundry & Healthcare Services, which could be allowed to hold on to more of their better- skilled foreign workers for now, even as they reduce their overall foreign worker headcount.

Its chief executive Chan Tai Pang said he already has plans for a "laundry ATM" in condominiums, where customers can deposit their soiled laundry to be tracked via radio frequency identification technology, instead of needing his workers to go door to door to collect it.

Said Mr Chan of the LED scheme: "We can keep some S-Pass workers in technical support or management roles to provide training to local staff, whom we hope to attract once we can make the job less taxing."

Business associations are also keen to have their members take advantage of the scheme.

Mr Ernie Koh, president of the Singapore Furniture Industries Council (SFIC), said the scheme will help its Creative Craftsman programme. Started last February to train more locals in carpentry, it had struggled initially to find local certified trainers.

Said Mr Koh: "I was even going to ask my 83-year-old semi-retired father to do the training, because I couldn't get anyone else."

Under LED, he said, SFIC could bring in skilled foreign craftsmen to train locals, without having them count towards the firms' foreign workers quota .

Singapore National Employers Federation (SNEF) executive director Koh Juan Kiat recommended that SMEs band together to put up proposals tackling industry-wide problems. SNEF will be organising forums for like-minded SMEs to get in touch."The scheme is not for one company to make a change within itself. Rather, it should be several companies coming up with a horizontal kind of solution that can transform the sector."

For some, however, the new scheme is not the answer.

Mr Jeffrey Tan, managing director of housekeeping firm Nafa System Services, said that to secure urgent contracts, "it would be good if MOM could (also) consider letting us engage interim foreign workers for three to six months, and in turn we make a commitment that we will replace them down the road with locals".

"Otherwise, we are dead in the water and cannot move."

This article was first published on Aug 24, 2015.
Get a copy of The Straits Times or go to for more stories.