Lower wage workers can expect higher pay in next 2 years: PM Lee Hsien Loong

·Senior Editor
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SINGAPORE - APRIL 07: Tables tray cleaners are seen mingling at a hawker centre on April 7, 2020 in Singapore. Singapore government starts closing non-essential workplaces and schools temporarily for a month from today, April 7 to contain the spread of the COVID-19 infections.  (Photo by Suhaimi Abdullah/Getty Images)
Tables tray cleaners at a hawker centre on 7 April 2020 in Singapore. (PHOTO: Getty Images)

SINGAPORE — Almost all lower wage workers (LWWs) can expect higher incomes within the next two years due to steps to boost their wages and Workfare enhancements, said Prime Minister Lee Hsien Loong in his National Day Rally speech on Sunday (29 August).

Lee outlined the various new and current government measures to support LWWs. But he also urged consumers to do their part to share the cost of paying LWWs higher wages.

Amid the COVID-19 pandemic, LWWs are “more stressed” than others as their jobs are less secure and they are more likely to be laid off, Lee said in his speech televised from a Mediacorp studio.

LWWs receive support from the government such as in housing, healthcare, retirement savings and education for their children. They also receive longer term support to improve their skills and productivity, Lee added.

One area of support is in the Workfare Income Supplement (Workfare) Scheme, in which the government tops up the salaries of LWWs in cash and Central Provident Fund (CPF) contributions. The government will increase its contribution to Workfare to $1.1 billion a year in two years’ time from $850 million a year currently.

The government has also accepted the three strategies recommended by a Tripartite Workgroup to uplift LWWs, Lee said.

One strategy is to extend Progressive Wages to workers from more sectors, starting with retail next year, and later food services and waste management. Specific occupations starting with administrative assistants and drivers across all sectors will also benefit from the changes.

The Progressive Wage Model (PWM) currently covers cleaners, security guards, landscaping workers and lift maintenance workers. For instance, under PWM, every cleaner earns at least $1,200. In two years’ time, they will earn at least $1,500 and this will go up further to at least $1,900 after another two years.

The second strategy is to require companies hiring foreign workers to pay all their local employees at least a Local Qualifying Salary. Currently, these companies have to pay the Qualifying Salary of $1,400 to some of their local employees, depending on how many foreigners they hire.

The government will tighten this rule to require these companies to pay all their local employees a Local Qualifying Salary, which will be adjusted from time to time.

The third strategy is to introduce a Progressive Wage (PW) Mark to accredit companies that are paying all their workers Progressive Wages. Lee said he has asked Nanyang Polytechnic students to design an official logo of the PW Mark for the Workgroup to consider.

The public sector will take the lead and buy only from such businesses bearing the PW Mark.

Lee emphasised that consumers have to help share the cost of higher wages for the LWWs, adding that he is glad that many Singaporeans are willing to support LWWs in this way.

“But businesses will still have to pass on some of the costs to their customers. So all of us, as consumers, must also chip in. Pay a little bit more for some of our favourite things, like bubble tea or bak chor mee, with or without 'hum' (cockles), to help the shop cover higher cleaning and waste collection costs,” Lee said.

Lee also expressed concern about a specific group of LWWs: delivery workers who work with online platforms like Food Panda, Grab or Deliveroo.

These workers have no employment contracts with the online platforms, and lack the basic job protection that most employees enjoy such as workplace injury compensation, union representation and employer CPF, Lee said.

MOM will be doing consultations on these workers and addressing related issues, he added.

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