Click for Menu

Changes to the Employment Act and what PMEs need to know

a year ago / ntuc / working girl

Work, work, work, work, work, work

Long-time readers of this space will know that I have been "involved" with the Labour Movement since a good four years ago. Since attending some of their events and having tea with their Labour MPs and getting to know them on a personal basis, I've always been rather intrigued by Patrick Tay.

Not because he's the most good-looking (I'm sorry!) - that's a spot reserved for Desmond Choo hahahh - but because I've always felt that the work Patrick does is the most relevant to me and has a direct impact on my working life.

You see, for the longest time, NTUC Assistant Secretary-General Patrick Tay has been championing for PMEs and for all professionals, managers and executives (PMEs) under the Employment Act. Recently, it was announced that more workers will be protected and they may see their working conditions improve under proposed changes to Singapore's main labour law, the Employment Act.

This landmark amendment was first officially raised by ex-Manpower Minister Lim Swee Say during the ministry’s Committee of Supply debate in March 2018 and includes three main updates to the Act, which stipulates core benefits for workers covered under it. And I suppose all the lobbying and PME advocacy by NTUC must have worked.

I first got to understand this better at a LawWorks Legal Primer on ‘Disguised PMEs’, a regular series that is organised by NTUC’s Legal Services Department. Two lawyers, Mr Melvin Chan and Mr Darren Tan from TSMP Law Corporation, along with Patrick, talked about ‘Disguised PMEs’, what's in a job title and whether your job title corresponds with your job scope as they expose the truth behind fake executive titles.

Both Melvin and Darren were the lawyers who had successfully represented the worker in the recent High Court case of Hasan Shofiqul v China Civil (Singapore) Pte Ltd [2018] SGHC 128 where Justice George Wei made several important pronouncements on “Who is a PME?”.

It was quite eye-opening (and appalling at how chao kuan Singaporean employers can get) really.

For example, Patrick shared in this blog post about a conversation he previously had with a relative of his. She had started work after completing her Higher NITEC Certificate and for many years worked in the F&B industry. At that point of their conversation, she's a restaurant manager and earned about $2,300 a month. She had been in this job for almost eight years now and she shared with him that she had often been recalled back during public holidays as well as having to stay back after work to look into receiving supplies to the restaurant and when repairs to the air-conditioning had to be carried out.

When asked if she was being paid overtime, she answered in the negative. She also shared that back in 2014, her boss amended her employment contract when they promoted her to a restaurant manager and included terms (power to hire and fire, supervisory and managerial responsibilities etc) which suggested that she was a PME (Professional, Manager and Executive). As such, they said she was outside the scope of Part IV of the Employment Act (which excludes coverage of managers and executives).

This meant that she was not entitled to overtime payments for her work in excess of the normal working hours.

Is this really a case of a proper classification of a PME?

And I'm sure that besides this lady, there are many others that we personally may know who were subjected to such unfair work practices.

As at June 2018, there was an estimated 30,000 workers in Singapore classified as PMEs, an acronym for professionals, managers and executives, but they earn less than $2,500 a month.

Thankfully, this was to change with the changes to the Employment Act as it will now extends key statutory benefits to an additional 430,000 workers.

As mentioned, there are three main changes to the act:

1) REMOVAL OF SALARY CAP TO COVER MORE WORKERS

Before: The Employment Act covered only workers who earn up to S$4,500.

After: The salary cap will be removed to cover all professionals, managers, executives and technicians, who make up 56 per cent of the local workforce.

The exceptions are public servants, domestic workers and seafarers who are covered by other Acts due to the nature of their work.

The Ministry of Manpower (MOM) has also proposed to raise the salary cap on the protection for hours of work and overtime pay to more workers.

Currently, about 99 per cent of blue-collar workers who earn up to S$4,500 and white-collar workers who earn up to S$2,500 come under the Employment Act's protection on this.

The proposed changes want to raise the salary cap for white-collar workers to S$2,600, which will extend protection to half of Singapore's workforce.

On overtime pay, the salary cap for white-collar workers will be revised upwards from S$2,250 to S$2,600, benefitting about 100,000 of the office workers.

2) DISPUTE RESOLUTION

Before: Workers had to go to two different parties to work out their employment disputes.

Salary-related disputes are mediated at the Tripartite Alliance for Dispute Management (TADM). If they are unresolved, these disputes are escalated to the Employment Claims Tribunals.

After: The Employment Claims Tribunal will act as a "one-stop service" to hear all employment-related disputes.

The proposed amendments also cover a redefinition of dismissals from workplaces.

Under the new definition, dismissals will include the involuntary resignation of an employee, and not just an employer terminating the contract of service of an employee.

Employers are also required to obtain the written consent of their employees should they want to make any deductions from their salary for certain services such as accommodation or amenities.

Written consent may also be withdrawn, without penalty in some scenarios, by the employee in written notice before the deduction is made.

3) MEDICAL LEAVE

Before: An employee's entitlement to paid sick leave can only be certified by medical practitioners appointed by the employer.

Employees can only qualify for paid hospitalisation leave if they are admitted to an acute hospital or national centre. This leave is extended to employees warded at community hospitals only if they are referred there by acute hospitals.

After: Any medical practitioner can certify an employee's entitlement to paid sick leave.

Additionally, any hospital or medical institution, such as community hospitals, will be considered an approved hospital and accepted for paid hospitalisation leave.

Employees can be entitled to hospitalisation leave when they are directly admitted to a community hospital.

In summary, here are the things you need to know when the amendments come into effect by April 2019:

small

small

small

small

To be honest, as impressed and happy as I am with this watershed amendment, a part of me is also wondering how else will employers try now to "shortchange" their employees. I won't lie - I've been on various sides of the fence, as an employee, as an employer, and as a HR practitioner managing the manpower and labour laws alongside the company's interest (after all, every business is about bottomline right?) and employees' welfare. It's a delicate balance and after exposure to our unique model of tripartism in Singapore, I realise how vital it is for us - workers, employers and the government - to reach consensus on potentially divisive matters.

This entire tripartite-effort aptly embodies our mature industrial relations system and responsible employers and trade unions that can look beyond their narrow interests to discuss issues objectively and reach agreement for everyone’s benefit. That being said, like how Patrick explained in his blog post, we must continue with this pro-active approach to ensure that our labour legislation stay current and relevant in a maturing economy and workforce.

And what if employers manage to find new ways to go around the system and take advantage (again) of their employees?

Then that's another battle for the Labour Movement I suppose.