MC wages: Despite law, injured workers left to beg for money

A migrant worker (right) discusses with TWC2’s case officer (left) the issues that he is having with delayed payment of his medical leave wages.

The Work Injury Compensation Act  2019 (WICA) was established as a social measure ensuring support for persons injured at work. More specifically, it aims to provide swift and cost-effective resolution, free from fault attribution, of compensation claims over injuries or deaths resulting from work accidents. Its purpose is to offer an alternative to the expensive, time-consuming process of a negligence claim under common law.

WICA allows injured workers to pursue three types of compensation:

• medical expenses,
• medical leave wages (also known colloquially as MC wages), and
• lump-sum compensation for residual permanent disability.

Furthermore, it mandates that employers should purchase insurance so that these obligations are always provided for.

We can see in the way the law is written – e.g. a no-fault process, requiring MC wages to be paid no later than specified times, mandating insurance cover so that resource constraints should be no reason for holding back – that it is a piece of social protection legislation with an emphasis on quick support (medical and financial) for the injured worker.

However, it should be borne in mind that the protections offered by this piece of legislation are for workplace injuries, and not any injury. This then poses a question at the very start of the claims process – was it a workplace incident? It’s a question which, as we shall see, can seriously delay the protections offered.

Delays are inhumane

For migrant workers especially, the WICA protections are crucial, as they have no family in Singapore to fall back on for support. Delayed access to treatment and financial support often result in unconscionable pain and distress for the worker.

In our previous article, Despite being insured, worker didn’t get the needed surgery, we wrote about how an employer, dragging their feet, effectively denied surgery to an employee with a broken finger. The crux of the matter was that the system makes an employer the gatekeeper of a migrant worker’s medical rights, and when an employer’s interests diverge from a workman’s, the employer has every incentive to use his gatekeeper role to stall or deny WICA protections to the worker.

In this article, we will discuss the other WICA protection that should be swift, and yet is too often not: financial support.

WICA provides for payment of “temporary incapacity compensation” which, in laymen’s words, means medical leave wages (MC wages). Once a doctor has certified that his patient (the worker) should be on medical leave, the law provides for a scale of payments, payable on a monthly basis no later than the usual payday for employees. The intention is to ensure that the worker has something to live on during the period he is unable to work.

Lately, TWC2 has seen an increasing number of cases where workers report that they have received nothing for months, or they received a bit and then payments stopped. In several cases, we checked with the Ministry of Manpower (MOM) and from the replies we got, we can say that there was a notable increase in MOM approving employers’ withholding of payments in 2023. The ministry condoned the delays because, they said, the insurers were still assessing the validity of the claims, i.e. whether they were workplace incidents and whether they fell within the scope of WICA.

There appears to be no time limit as to how long such a validity check can take, even if delays for over a month eviscerates the intent of the law to provide prompt relief.

Our observation is that there has been a retrograde shift in MOM’s stance in favour of employers and insurers, and against workers’ rights, and we explain here that MOM is not only wrong in its interpretation of the law but heartless too.

Unlike the compensation for permanent incapacity (permanent disability), which often arrives after the injury has stabilised (typically six months or more), entitlement to medical expenses and MC wages arise immediately following a work injury. The wording of Sections 16 and 17 of WICA imply a legislative intent to ensure timely medical care and protection of the financial stability of injured workers and their families.

Compensation for medical expenses

Section 16 mandates that employers “directly” pay injured workers’ medical expenses to hospitals or clinics, guaranteeing prompt medical attention irrespective of the workers’ financial situation. It is not a reimbursement scheme. This is to ensure that a low-wage worker who is unable to afford the cost of surgery or other necessary treatment is not asked to “pay first, claim later”. A worker who is unable to pay first would in essence be denied treatment, or would have it delayed while he tried to raise the money on his own. The “directly” provision in WICA is thus a sign that the law does not want delays to cause more pain and anguish to an injured employee.

Compensation for medical treatment

16.—(1)  An employer is liable to pay compensation in accordance with paragraph 5 of the First Schedule for the following medical treatment received by an employee for a work injury:

(2)  The compensation payable under subsection (1)(a) for medical treatment received at an approved medical institution by the employee must be paid directly to the proprietor of the approved medical institution, after deducting any amount previously paid by or on behalf of the employee to the proprietor of the approved medical institution for the medical treatment.

Medical leave wages

Section 17 ensures compensation for lost work days due to work-related injuries, with payments scheduled to align with the workers’ regular salary pay days. This aspect emphasises the legislation’s focus on safeguarding the financial well-being of injured workers and their dependants.

17.—(1)  Where any work injury results in the temporary incapacity of an employee, the compensation the employer is liable under this Act to pay to the employee is a periodical payment that is —

…

(b) payable not later than the same day as earnings would have been payable to the employee under the contract of service under which the employee was employed at the time of the accident, except that the interval between periodical payments must not exceed one month.

Delays while checking validity

As mentioned above, these WICA compensations are only available for work-related injuries. The insurer may launch a validity investigation to establish whether there was in fact an injury and whether it was sustained at work (i.e. in the course of employment). These validity investigations can take months, sometimes more than a year. The insurer, employer, or injured worker can file an objection if they are unsatisfied with the outcome of the investigation, but naturally, that’s only possible after there has been an outcome, which can be well into the future.

Although validity investigations hold significance in WICA claims, the law notably lacks any explicit mention or provisions regarding the process that insurers’ should adopt or timelines. Nor is there any mention about suspension of worker’s entitlement to medical expenses or MC wages.

Instead, sections 16(5) and 17(5) outline a recourse for employers to reclaim compensation if a claim is later deemed invalid or false. Section 54(4) also empowers the Commissioner to “order the claimant to refund or to reimburse any overpayment.” This suggests that WICA intends for both compensations to be disbursed even during ongoing investigations into claim validity.

In 2019, when the latest version of WICA was being moved through Parliament, Senior Minister of State for Manpower Zaqy Mohamad said:

Recourse for employers for compensation paid due to error or false or misleading information

F5. Under current WICA, the Commissioner can order the employee to refund to the employer any medical leave wages paid if the employee withdraws his claim, the accident was subsequently determined not to be work-related, or it was a false claim. We will extend the refund to lump sum compensation and medical expenses. Clauses 16 and 54 of the Bill enable the Commissioner to order the claimant to refund to the employer (or insurer), if the employer (or insurer) had paid for the lump sum compensation or medical expenses due to error or false or misleading information. This is on top of it being an offence under clause 62 for any person to obtain compensation by providing false or misleading information.

Our analysis of the intent of legislation and Zaqy’s words to Parliament align with an advisory that used to be on MOM’s website. Here is an archived screenshot of it, dating from 23 March 2023:

This page was up on the Ministry of Manpower’s website earlier in 2023 (screenshot from 23 March 2023) but has since been taken down.

So, why has MOM removed this advisory from its website? We can only speculate; we discuss our thoughts below.

Pro-elite, anti-worker

In one typical case, we observed that an injured worker, R, waited eight months to receive his MC wages – without back interest. The delay in payment was due to the prolonged investigation, which eventually validated R’s claim. R was only informed about the reason for the non-payment after the MC wages were finally paid. Silence and opacity is another characteristic of the WICA process as presently operated. Throughout these eight months, R faced severe financial hardship, compelling him to borrow money from friends and seek assistance from NGOs, stripping him of dignity – the very thing WICA was meant to safeguard. He was completely unable to support his family during this period.

Interestingly, from some cases that TWC2 has handled, it seems to us that MOM is less likely to endorse the non-payment of medical expenses but more likely to condone the non-payment of MC wages. Possibly, this is because withholding medical expenses could impede injured workers’ recovery – in economic terms, it is called preservation of asset value. MOM can therefore be accused of cherry-picking MC wages as a suspendable entitlement while medical expenses are not so easily suspended.

Social protection aim should not be lost sight of

As highlighted above, ample evidence supports the notion that WICA was created to guarantee injured workers’ access to medical treatment and safeguard their means of livelihood. MOM’s own advisory from March 2023 confirmed that MC wages were to be paid to the workers regardless of the validity of the investigation.

If legislators had intended that entitlements could be suspended, they would likely have also written safeguards within the legislation itself, so that these suspension cases would not be abused. Safeguards might have addressed both the duration and reasons behind such investigations, and provisions to allow employers and injured workers to review and scrutinise the investigation process.

Yet, we see no safeguards written in. A sensible interpretation suggests that WICA did not intend for medical expenses and MC wages to be suspended indefinitely pending ongoing investigations.

Any lack of viable mechanisms for employers to seek recourse, should it ultimately be found that the injury was not work-related, should be rectified through amendments to WICA’s provisions establishing a more secure cushion for employers, rather than by relying on MOM’s selective interpretation that unfairly disadvantages and dehumanises injured workers.