Previously, the government had announced (over several announcements in the past few months) that foreign worker levies for employers of Work Permit and S-Pass holders would be waived for payments due in the months of April, May and June 2020. The most recent iteration of announcements stated that for July 2020, there would be a 50% waiver of the levy.
In the latest announcement posted on the Ministry of Manpower’s website (1 August 2020), the waivers have been extended yet again, as
the majority of an estimated 15,000 firms in the Construction, Marine Shipyard and Process sectors continue to face financial difficulties as they are unable to resume work due to COVID-19 measures. This situation is likely to persist until the foreign worker dormitories are fully cleared in August 2020 and their workers are progressively allowed to resume work thereafter.
In this latest announcement, the waivers will now be
- July 2020: 100% waiver (instead of 50%)
- August 2020: 100% waiver
- September 2020: 100% waiver
- October 2020: 75% waiver
- November 2020: 50% waiver
- December 2020: 25% waiver.
Unless there is yet another extension, the foreign worker levy, usually in the hundreds of dollars per month per employee, will be fully payable starting January 2021.
The announced waivers only apply to employers in the Construction, Marine shipyard and Process industries. Other sectors which have significant numbers of foreign workers such as Manufacturing, Service, Conservancy and Landscaping do not enjoy the waivers.
The government had given employers of Construction, Marine shipyard and Process workers rebates of $750 per month per worker through the months of April, May and June 2020. This came through various announcements iteratively. The Ministry of Manpower has also stipulated that the rebates should be used to pay for the workers’ accommodation and meals, with the balance applied to “salary support” — a vague term that is the source of much confusion. See our article Manpower Ministry’s advisory on circuit breaker still unclear (4 May 2020).
The rebate for July 2020 was previously set at $375, half of $750.
Now this $375 rebate is to be extended for two more months — August and September 2020.
This will be followed by four months of $90 rebate (October, November, December 2020 and Janary 2021) “to help firms adjust to more stringent Safe Management Measures” at worksites.
As if things are not confusing enough, the $375 and $90 rebates are only applicable to Work Permit holders. S-Pass holders will not be included in the count of eligible employees (which they were for the $750 rebate). This penny-pinching exclusion of S-Pass holders only appears in fine print of footnotes, not in the body of the announcement.
Another footnote to the latest statement adds that “closer to December 2021, the government will decide if there is a need to further extend the $90 FWL rebate by another year to December 2022.” It appears to be a typographical error. They probably mean December 2020 and December 2021 respectively.