TWC2 dismayed at suggestion that foreign worker wages be cut by 25%

Transient Workers Count Too is dismayed that the Ministry of Manpower (MOM), in its Advisory of 6 April 2020, is giving licence to employers of foreign workers to cut their wages by 25%. We refer to paragraphs 18.2.2 and 21 of the Advisory ( titled “Advisory on salary and leave arrangements during Circuit Breaker”.

While the government may be intending to assist employers through the pandemic and in particular the Circuit Breaker disruption, it is extraordinarily regressive that bosses should be helped by allowing them to reduce the salaries of those who are already the lowest-paid in Singapore.

The Advisory is also written in confusing language. It will be rare that any foreign worker can make any sense of it. Even employers will find it very difficult to parse. The result will be employers interpreting it in ways that suit them best and riding roughshod over the nuances of the Advisory regarding their other obligations.

Moreover, MOM’s current mechanism for recording the lowering of salaries is designed for contract amendment, i.e. permanent reduction. However, the intent of the Advisory is of a temporary reduction for the Circuit-Breaker period. If employers use the current mechanism to implement the salary reduction, the reduction will be permanent, affecting workers’ salaries even in the post-Circuit-Breaker period.

There is a huge risk that employers will use MOM’s Advisory as blessing to deprive workers of 25% of their wages on a permanent basis. This will create massive resentment that cannot be good for labour relations in Singapore or for our country’s reputation.

It also runs contrary to the assurance that Prime Minister Lee Hsien Loong gave in his video broadcast of 10 April wherein he said that “We’ve worked with employers to make sure they’ll be paid their salaries and can remit money home.” His words give the impression that there will be no jeopardy to migrant workers’ income.

If MOM feels that employers of foreign workers need more help to tide over the Circuit Breaker and pandemic period, the right response should be to extend the Job Support Scheme to foreign workers, giving employers 25 – 75% support for their payroll costs, depending on sector, and 75% for all sectors in April, in line with support given to employers of resident employees.

TWC2 calls on MOM to rescind this part of the Advisory, and to declare all salary reductions made subsequent to this Advisory null and void.

Foreign employees are vital to Singapore. It is incoherent for the Prime Minister to make soothing assurances while MOM gives the green light to reduce salaries.

For more detail about this issue, please see our longer statement here.