Kickbacks are illegal, but how to eliminate them?

Posted by on August 10, 2015 in Articles, Stories

sharif_3900_dollars

By Seema Punwani

You must spend money to make money.

Even Forbes magazine propagates this theory and it has probably inspired several entrepreneurs. A worker living across the Indian Ocean in Bangladesh who has limited formal education and sparse knowledge of English has in all probability not come across this famous quote. However for him this is a life truth. In order to leave his country and come to Singapore to make a living he has to pay a commission to his agent to get him to Singapore. So he uses his savings, borrows money from his friends and family, pawns his wife’s jewellery or does whatever further it takes and gets to Singapore in the hope that the money he has spent will help him earn more.

Reality strikes

To his dread, he is made to work for a lesser salary than what he was promised. Instead of $26 a day, he is now told his salary is now $20 a day. Six dollars may seem like a small amount, but it is 30% lower than what was committed. Would anyone of us work for a salary that is 30% lower than originally agreed?

His woes don’t end there. There are times when he does not get paid for months on end. This is a very common problem amongst the foreign worker community in Singapore.

Sharif’s story

This is what happened to Sharif too. He was offered lesser pay than what he was promised. So Sharif tried to get a transfer. However in order to make that happen the ‘boss man’ asked for S$3,900 as fee.

Thus in order to make money, Sharif decided to spend more money. He handed the amount in an unidentified packet to this employer in the back streets of Little India. The employer was described as ‘big Indian Tamil man’. Money exchanged hands but without any receipt or acknowledgement of any kind.

At first, it seemed to be working out. Sharif got the new job as promised. But within weeks, it began to look like a very bad deal instead: he wasn’t being paid his salary.

After three months working but waiting in vain, he lodged a complaint with the Ministry of Manpower. MOM was very helpful and managed to get Sharif his backpay. However the question of the $3,900, which is illegal for employer to charge, still remains.

Paragraph 5 of Part III of the First Schedule of the Employment of Foreign Manpower (Work Passes) Regulations, (page 35), states:

  1. An employer shall not demand or receive any sum or other benefit from an employment agency or any other person in connection with the employment or change in employment of a foreign employee.

The penalty for the first offence is a fine of up to $10,000 or imprisonment of up to twelve months, or both.

Sharif has approached MOM to recover this fee but in absence of any evidence, his case seems weak.

An oft repeated story

Sharif’s case is not unique. At TWC2 we get several workers with similar despairs. It’s been observed that in recent times, MOM has taken more interest in investigating such cases, putting fraudulent employers on alert. This was not the case few years ago where such dishonest activities went unnoticed.

Yet, it will remain difficult to mount a prosecution, as TWC2’s Alex Au says: “The fundamental problem in Sharif’s case is that there is no proof to show that $3,900 was paid.”

“This will be a continuing problem. Employers who demand kickbacks also know that the practice is illegal. They’re not going to be so foolish as to leave a paper trail of their demands and receipts.”

For this reason, TWC2 has been urging a more effective solution: Greater restrictions on employers bringing in fresh workers from abroad. “So long as there is virtually infinite supply of labour from the vast populations of India, China and Bangladesh, the laws of supply and demand will create a price that workers have to pay to obtain jobs,” Alex explains. When employers are generally disallowed from bringing in fresh workers, but must hire from those already here, there will be a better balance of supply and demand, and the increasing scarcity of migrant labour will eliminate kickbacks.

TWC2 has made this proposal repeatedly over the years, but MOM has not yet been persuaded, he says.

Whether Sharif will get his money back is anyone’s guess. Until MOM realises that the problem is structurally rooted, modifies policy and clamps down hard on rule-breakers, the system won’t change. Many other Sharifs will find themselves swindled out of their savings, much worse off than before. And the vicious cycle will simply continue.

TWC2 is an organization that is dedicated to assisting low-wage migrant workers when they are in difficulty. We are motivated by a sense of fairness and humanity, though our caseload often exceeds our
means.

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