One quarter of Labour Court salary orders unpaid

Posted by on February 24, 2017 in Articles, Facts, research, analysis, News, News Flash

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At the parliamentary sitting of 9 January 2017, Nominated Member of Parliament Kok Heng Leun posed a question to the Minister for Manpower Lim Swee Say (pictured above). As published in the Hansard,

Labour Court Orders on Employee Salary Non-payment

Mr Kok Heng Leun asked the Minister for Manpower (a) how many complaints about salary non-payment or short-payment were lodged by employees in each year from 2015-2016; (b) how many cases were referred to the Labour Court; (c) how many Labour Court Orders were issued in favour of claimants; (d) how many Orders remained unpaid by the 14th day after their issuance; and (e) how many employers were prosecuted for non-payment or short-payment of 6 salary in these two years respectively.

Mr Lim Swee Say: About 6,000 salary non-payment and short payment cases were lodged by employees each year in 2015 and 2016 (excludes ongoing cases in Labour Court). For each year, the breakdown of the cases were similar and broadly as follows:

parl_question_2017jan_table1

Among the 1,400 Labour Court orders issued in favour of employees, the payment status is as follows:

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The 350 defaulted orders involved 200 companies which were mostly in financial difficulties or had ceased operations. MOM took enforcement actions against all of them which included warnings, fines and restriction of work pass privileges. About 25 employers were charged in court for more egregious offences each year in 2015 and 2016. Such offences carry a maximum fine of $15,000 and/or imprisonment of up to six months per charge.

Reactions by TWC2 board members and experienced volunteers

Loh Wei Hung: The default in payment is still very high at 25% (350 out of 1400), but it’s lower than the statement a few years back by the Manpower Minister that 33% of cases that won against the employer did not receive their just compensation. It may be there’s been improvement in getting the employers to pay up, but the difference could also be due to the definitions in the two statements.

Actually, the data shows that a majority (4000, or 2/3) of the cases are mediated away. So it’s more important simply from the viewpoint of impact to workers that the mediation process be done fairly. The data suggests that TWC2 should zero in on the mediation process. The final Labour Court numbers would also be biased by the filtering in the mediation process, so having data on the mediation process is important to interpreting the Labour Court data accurately.

Of course, the caveat here is there’s no differentiation between Singaporeans/PR and migrant workers in this data. Knowing the percentages of Singaporeans to migrant workers* for each of the above numbers would be necessary for a rigorous conclusion.

* A Straits Times news story ten days later on 19 January 2017 reported a response by MOM that said there were 4,500 salary complaints from foreign workers in 2016. That’s 75% of the 6,000 salary cases a year. The 19 January article can be seen within this other post

Peter Teo: I think it might be good to find out what judgements “in favour of the employees” means in MOM terms. My reading is that it means the employee received an award even if the award was a small percentage of the amount claimed or entitled to. I have yet to see or hear of a case where the worker received the entire amount claimed. So in practice, a worker could be owed $30,000 but because of restrictions in the Employment Act [e.g. time limits], a lack of understanding of what he is entitled to … and because of documentation and factors beyond his control receive a $2,000 award at Labour Court after a year long stay in Singapore with no job and means to support his family. And there is still a 25% chance he will not get paid that $2,000.

Bear in mind, workers typically do not file a claim if they get paid. Even if they are underpaid. It’s only when they don’t get paid at all do they tend to seek redress.

Alex Au: The most striking thing about the answer is how it comes in round numbers — now why is that so? Is the ministry unsure of its numbers? Is the dataset meant to fudge something?

Secondly, compared to the number of salary cases, and especially the high number of defaulting employers (about 200 companies and 350 cases per year) to have only 25 employers charged in court seems a very low number (not that these 25 are necessarily among the 200 defaulters). After all, every time a Labour Court, after hearing evidence, has found in favour of employees, it is a case cut and dried that a violation of Section 21 of the Employment Act has been committed. Hauling these employers to court should be very straightforward; but why then so few?

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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