Global growth is expected to improve in 2018 backed by higher growth in emerging markets and in the United States. However, trade tensions and concerns over protectionist actions could have a negative impact on international trade and global growth. In Singapore, the economy grew by 3.6 per cent which is an increase from 2.4 per cent in the year 2016. Sectors such as electronics and transportation are expected to do well, whereas those like offshore engineering and construction are expected to face headwinds. Overall, Singapore’s economy is expected to grow by 2.5 to 3.5 per cent.
The New National Wages Council (“NWC”) has recommended a set of wage guidelines for 2018/2019. These include:
Wage Recommendation for All Workers
The NWC re-establishes the principle that the increase in the wages should be fair and sustainable after taking into account the varied business conditions, the economic outlook across sectors and firms, and the productivity growth. The firms’ business prospects should mirror the increase in built-in wages whereas variable payments should reflect the workers’ contributions and the firms’ performance.
Wage Recommendation for Low-Wage Workers
The NWS is of the belief that it is beneficial to continue to provide quantitative guidelines for low-wage workers. It also believes that the basic wage threshold should be increased from $1,200 to $1,300. Additionally, NWC also encourages companies that have achieved productivity improvements in the year 2017 to provide an additional one-off special payment of $300 to $600, in a lump sum or over several payments, to low-wage workers who earn a basic wage of up to $1,300 per month.
Low-Wage Workers in Outsourced Work
The NWC recommended that the experience and performance of the outsourced workers to be taken into account by the service buyers and service providers when employment contracts are renewed or offered. This would help in avoiding the reset of wages and benefits for such outsourced workers who performed the same job functions when service providers are changed. In addition to this, the NWC also urged the service buyers and service providers to ensure adequate training and improving the employment terms of the outsourced workers by working together.
Employment of Older Workers and Back-to-work Women
The NWC has extended the Special Employment Credit (SEC) until 2019 to support employers hiring older Singaporean workers. The employers hiring Singaporeans aged 55 and above and earning up to $4,000 per month will be provided wage offsets of up to 11%. To recruit and retain back-to-work women as a valued source of talent and manpower, the NWC also encourages the employers to implement family-friendly workplace practices and flexible work arrangements.
Application of Guidelines
The NWC guidelines cover the period from 1 July 2018 to 30 June 2019. The guidelines apply to all employees – professionals, executives, management, and rank-and-file employees. They also cover unionised and non-unionised companies in private as well as public sectors. The recommendations apply to re-employed workers as well.
The NWC noted that the employers should share company wage information, business prospects and performance with the unions to facilitate wage negotiation. It further encourages the employers to address any issues faced by them by working with the employers’ association and unions.
