In February 2021, the Straits Times featured John Peter Ayyavu’s case in a video and a news story.

This is an editorial comment by TWC2

Continued from Part 4.

Relevant laws and our commentary

John Peter Ayyavu’s case has several points in which written law intersects with reality. In almost every instance, the law or the implementation of it comes off badly.

Here we will discuss the key intersections.

But it is also worth noting that none of these defects are new. They have been evident from countless cases in years past. That they persist reshapes the question, from ‘What’s wrong with the law?’ to ‘Where’s the political will to improve?’


In Part 1, we described the amount that John and his family had to pay to get him the job with Deiva Shanmuga Sri Construction Pte Ltd.

The law says:

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

— Employment of Foreign Manpower Act >> Employment of Foreign Manpower (Work Passes) Regulations 2012 >> First Schedule >> Part I, paragraph 5.

In John Peter’s case, the kickback was paid in two instalments: about half paid in India and the other half paid in Singapore.

With respect to the first half, MOM often takes the position that because recruitment fees are paid in a worker’s home country, the matter is beyond MOM’s jurisdiction. This position ignores the fact that large sums of money paid outside of Singapore end up in the pockets of agents and employers in Singapore. Jurisdiction and oversight over these transactions should be possible. After all, nothing in the law, quoted above, restricts its scope to only payments in Singapore.

That said, we do not know whether MOM took this starting position in their investigation. We do not know because MOM was, typically, brief to the point of being uninformative in describing the outcome. “Insufficient evidence” is all they said without elaboration.

But the silence about whether they even interviewed John Peter’s father, Ayyavu M A, who was the one who made the first payment (in India), suggests that MOM took its usual “not within our jurisdistion” stance.

At first reading, a more debilitating defect may lie in the meaning of the word “employer” in the principal Act and the Regulations. Technically, the employer was the company, Deiva Shanmuga Sri Construction Pte Ltd. Section 2 (Interpretation) of the Employment of Foreign Manpower Act says that in a case where a foreign employee has or had a valid work pass, “employer” means “any person specified in the work pass as the employer of the foreign employee”. A company can also be an employer as it is a legal person.

Would payments made not to the company but to Seenivasan himself come within the ambit of the law?

As described in Part 1 of this story, both payments demanded from John and his family were paid to Seenivasan Arumugam, the boss. More specifically, Seenivasan was a director and the controlling and majority shareholder of the company and the person who made the recruitment decision. He was later also the person who gave work directions to John Peter.

However, Section 20 of the Employment of Foreign Manpower Act expands the scope to include people who act in the name of the employer. This section says,

20.—(1) Where an offence under this Act committed by a body corporate is proved —
(a) to have been committed with the consent or connivance of an officer of the body corporate; or
(b) to be attributable to any neglect on his part,
the officer as well as the body corporate shall be guilty of the offence and shall be liable to be proceeded against and punished accordingly.

And indeed, there have been cases where MOM has successfully prosecuted employers (in its broader meaning) for kickbacks. For example, in May 2018, Poh Kwi Ko, the Director of Aik Heng Contracts and Services Pte Ltd, was sentenced in the State Courts to 20 months’ imprisonment and a total fine of $158,750 for illegal importation of labour and collecting kickbacks (source).

It is not clear why in John Peter’s case, MOM came to the view that there was insufficient evidence when there was an ATM receipt dated the very same day that John first arrived in Singapore. It may be a circumstantial case, but one that is also supported by the first payment made by John’s father — for which documentation is available — establishing a certain pattern.

The employment contract

It is established law that a worker’s employment terms are governed by an employment contract that is negotiated between the employer and the employee.

Setting aside the issue of unequal bargaining power that is inherent in these situations, leading to doubts about whether contracts are freely entered into, TWC2 has also seen innumerable cases where employers do not quite view themselves as bound by the terms of the employment contract.

To begin with, the common practice of not giving employees a copy of the signed contract makes it tempting for employers to ignore the stated terms. Employers may hope that workers will not be able to hold them to the terms of the contract if they do not have a reference copy in hand. Nor is there any system (unlike in Qatar) where contracts must be deposited with the government to make substitution difficult.

In John Peter’s case, we saw this practice of ignoring the terms of a contract in action. Even after the salary claim was filed, and the employer wanted to show the TADM mediator that it had paid John Peter his salary contrary to what John was saying, the payslips that the company fraudulently drew up showed monthly salaries that bore no relation to the salary stated in the contract. It was as if the company didn’t expect anyone to check the details against the contract. Or, for that matter, against the application for an S-Pass which the company would have submitted to MOM at the very beginning.

This incident demonstrates the degree of impunity employers can feel.

John Peter was, in a sense, fortunate that the fake signature the boss concocted was entirely different from John’s real signature. If it had been similar, it might have created serious difficulties for John when the employer presented a fake employment contract to the Small Claims Court (or any other court). The court have might difficulty concluding which version of the employment was genuine.

Thus, having a third party depository for employment contracts would help, though it is recognised that this too needs to be carefully designed so as not to create new vulnerabilities.

Impaired bargaining power

On his very first day on the job, John Peter already had a glimpse of what was to come. As described in Part 2, the boss put a forged signature onto an MOM form. It wasn’t even done secretly. It was done in front of John, and the point was made that henceforth the newly-created signature (in the boss’ hand) would represent John. “This is your new signature and we can now sign for you whenever we please,” the boss told John.

Why didn’t John protest immediately?

Everything that was described in Part 1 was why. He and his family had paid the boss over $6,000. If he protested, the boss might very likely cancel the S-Pass and the expensively-bought job would be gone in no time.

Making workers pay for their jobs, whether through hefty recruiters’ fees or through kickbacks paid to company personnel is the nasty seed that sprouts into widespread corruption and criminality. These become endemic when workers are too disempowered to protest.

Needless to say, MOM’s final conclusion that there was “insufficient evidence” to take action just adds to the persistence of this plague.

The salary claim process

The process for salary claims not exceeding $20,000 is governed by the Employment Claims Act. Workers (claimants) have to go through mediation conducted by the Tripartite Alliance for Dispute Management (TADM). When TADM negotiations fail, workers can bring their claim to the Employment Claims Tribunal (ECT), which adjudicates the matter.

The TADM process is not difficult for workers to navigate, but the ECT stage is different. It requires electronic filing of submissions and responses to counter-party submissions, which means that workers will need a fair degree of digital literacy and the necessary equipment to do so. It is also all in English and most workers have a poor grasp of it.

If the ECT order is appealed, as happened in John Peter’s case, it gets even more complex, because the issues raised on appeal can be very technical (in a legal sense). John needed help from TWC2 to put together his arguments against the points raised by the employer, Deiva. It is doubtful if any typical migrant worker can do this on his own, so what was intended by the Employment Claims Act to be a simple-to-navigate system that does not require lawyers, is in fact not quite so.

Enforcement of the ECT order

The most inadequate part of the salary claims process is the enforcement of the ECT order. An order is only as good as the enforcement mechanisms employed to obtain payment. At its root, the problem is that the State sees a money claim as a civil dispute between two private parties. This is why John Peter got very little help from the authorities. MOM did impose a hiring freeze on Deiva, but such measures are only effective when the company is a going concern with an interest to stay in business. In the case of companies that are already failing commercially or where the boss can flee abroad and abandon his business (and his creditors), a hiring freeze is not more than a mosquito bite.

It is important to rethink the whole safety net for salary non-payment beyond the mere issuance of an ECT order.

Backstop Fund

TWC2 has long proposed what we call a Backstop Fund (or a Salary Restitution Fund). It’s a form of insurance, funded by a mandatory premium payable by all employers. Any employee with an ECT order for unpaid salary that remains unpaid a month after the ECT’s order should be able to obtain restitution from the Backstop Fund, perhaps at a slight discount. The Fund then takes over the creditor rights and pursues the claim relentlessly against the employer.

Since the ECT’s jurisdiction is anyway capped at $20,000, the maximum amount that the Fund needs to pay out to any one worker is likewise capped.

The Fund, consolidating all these claims and funded by insurance premiums, would have the resources to use all the available tools of the legal system to pursue reimbursement from delinquent employers. In John Peter’s case, TWC2 had to get him a pro-bono lawyer to commence garnishee proceedings and explore other avenues, such as writs of seizure and sale. This is not a scalable solution. How many other workers with unpaid ECT orders will be able to benefit from pro-bono lawyers?

Then-Manpower Minister Josephine Teo admitted to Parliament on 6 March 2019 that half of salary claimants with ECT orders in their favour did not get full recovery.

Of the ECT orders issued, about half of the claimants received full payment from their employers. Another 16% reported partial payment, while 36% reported no payment (source).

Expecting workers to hire lawyers in the wake of a successful ECT claim in order to pursue collection completely defeats the intention of the ECT process as a simple-to-navigate low-cost system for recovery of wages.