Fair Consideration Framework, what do you need to know:
What it actually is:
Employment Pass (EP) applications will have to comply with advertising requirements. This simply means you can’t get an EP without having to demonstrate that you really, really, absolutely can’t find a local that will do the job.
What’s the penalty?
Similar to the Tripartite Aliance for Fair Employment Practices (TAFEP, www.tafep.sg), companies that practice discrimination to locals will hear from officers by the Ministry of Manpower (MOM). When that happens, the offending company will see themselves put on a blacklist, and slowly, they’ll find their applications for foreign talent rejected.
There are a 101 means of corporate torture tripartite partners can inflict on an offending company. There is no need to institutionalise a means of punishment. Perhaps this is the reason why we were not able to find an official statement that prescribes a course of action. But if you have the chance, speak with officials from the Ministry of Manpower or the NTUC and this will quite likely be what they will tell you.
Only EP holders are affected, so is MOM only protecting degree holders?
No. The Fair Considertations Framework is a framework that covers all. Today, the framework only requires an compliance process for EP holders. For good reason also, you don’t want to freak employers out with a slew of legislation that they are unable to comply with immediately.
But it doesn’t matter if you’re an EP, Work Permit or S-Pass holder, you have to hire fairly. Otherwise the penalties described above will also affect you.
Why doesn’t it cover those earning $12k and above?
Actually, yes it does. Same as above and also for the simple reason that individuals earning $12k and above are usually high level directors, CEOs or a Chief-of-something. The law merely says that they are exempt from the process of advertisements (because who would advertise for a CEO?) but they are not exempt from fair considerations. Thus the same framework applies to them.
I’m an employee, what does it mean for me?
Fair considerations for Singaporeans. Once upon a time, employers could hire the cheapest solution possible for their business. This made businesses lazy and with abundant supply of labour, there was no incentive to utilise labour efficiently.
With stiff competition for labour, business owners also need to think about how to make their jobs more attractive to Singaporeans – this means either paying more, making work easier, more interesting and/or more meaningful.
I’m an employer, what does it mean for me?
Business owners need to learn of this thing called: progressive wage. Whilst most of us take this for granted, many jobs don’t have this. Cleaners, security guards, some admin jobs for example.
Tripartite partners understand the risks behind adopting minimum wage too quickly, so in it’s place, they have been actively encouraging business to practice progressive wage. Which, in a nutshell means apart from paying a minimum (usually $1000), they also have to increase wages progressively throughout the employee’s career.
(In the cleaning industry, laws have been passed and if businesses don’t practice this Progressive Wage, they won’t be granted a licence to do their business)
*Interesting to note is that the entire business of the Fair Considerations Framework came out of the NTUC.
Is it going to make the business environment tougher?
Yes. Singapore is many things: efficient, safe, good laws, sound infrastructure, no-nonsense… but Singapore is not a cheap place to do business – be it the cost of land or labour. And while businesses talk about lowering costs in every area of business, I don’t agree – and I strongly resist that they even think about lowering the price paid to human labour.