Making work, work

 

The labour environment is transforming.

Some say it is “populist”. Call it what you will, some of these actions are necessary for the well-being of this nation.

A cursory glance at the heat map of this nation reveals the matter of over-population very strong. Although the issue of Foreign Workers & Immigration ranked 7th out of a list of 7 top concerns according to a Straits Times poll (http://www.straitstimes.com/half-time), we need to acknowledge the negative effects it has on wages and emotions.

You see, it is not just crowds that are annoying people. When you have a foreign workforce who is willing to work for less, you weigh down the wages of Singaporeans.

We talk about lifting of wages through minimum wage, but minimum wage is at best a temporary palliative, it won’t work for the long term. If you want to increase wages, call on the forces of demand and supply.

As long as the demand for labour is strong (and it is, given our healthy economy), when you cut the supply to the manpower buffet, businesses scramble to fight for employees.

I don’t care if you call it populist. The nation needs it. Tripartite partners have been pushing out a slew of (what seems to be) employee-oriented policy. Some employers have found it unnerving.

My friend Terry Tan, a businessman in manufacturing, said this: “Why is the Government making it so hard for employers? We grow the economic pie, we create jobs. If anything, they should help us preserve our business and we in-turn will preserve the financial health of our workers!”

Strong words. But consider this paragraph by Linda Lim from the book “Hard Choices to Keep Singapore Going”. In it she says “…no doubt some businesses would not be able to adapt and would have to move out of Singapore or shut down. Is this necessarily a bad thing? No, in a vibrant capitalist economy, this is exactly what one expects…. Businesses that cannot adapt should and will exit the market. Their exit also frees up labour and capital resources for the more productive parts of the economy.”

Her message encodes the grim message of economics: be a better business, or cease to be a business.

 

How these policies protect workers

The Ministry of Manpower, together with the NTUC have deliberated, debated and together with workers and employers introduced several changes to labour policies.

Changes to the Employment Act protected another 450,000 workers. They now have statutory protection involving working hours, break times, overtime pay and retrenchment benefits.

Mandated implementation of the Progressive Wage Model impacted all workers in the cleaning industries. Not only are they required to be paid a base recommended salary, employers must see to it that their salary increases progressively together with their skills.

Small Claims Tribunal is in now in the works, saving workers a lot of time and money in costly civil suits with nasty employers.

The use of Employment Contracts and Pay Slips is being strongly encouraged by all levels of employers… before it goes into law in two years.

To prevent foreigner enclaves from forming, the Fair Considerations Framework is installed so that Singaporeans are not subject to discriminatory hiring practices.

The Workfare Income Supplement Scheme (WIS) raised take-home pay and retirement savings of lower-wage Singaporeans. Some 400,000 Singaporeans would have benefited, receiving over $600m in WIS payment.

To some, these measures taken are open doors. To others, these represent difficult hoops to jump through.

Although largely for the better good, society needs to adapt to these policies. To better appreciate employment policies, it is not quite enough to look at the needs of employees and employers alone. One needs to have a macro view of the business environment.

Employees are paid by employers. Employers are paid by customers. If any one piece is lacking, the chain collapses.

If we want our wages and welfare to increase, we have to think in these terms: how to be a better employee, a better customer and a better employer – how to help each one in the chain create better value.

At any one time, we are sometimes a customer, sometimes an employee and sometimes an employer. If we only look inwards and be self-serving, the relationship will not work. But if we are considerate to the other party, we actually are doing ourselves a bigger favour.

As Labour Day looms closer, I would like to urge us all to think of these three pieces: employer, employee and customers, as one ecosystem. From that vantage, we can then deliver fresh arguments and debate to keep the economic machine working to the benefit of Singaporeans.

 

 

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About the author

Benjamin Chiang

Benjamin Chiang is an enthusiast of good advertising, deep thinking, labour issues and chocolate. He writes also at www.rangosteen.com and occasionally on Yahoo!

The views expressed are his own.

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