Special Employment Credit (SEC)

Employers to receive Special Employment Credit for hiring older workers

By Saifulbahri Ismail, Channel NewAsia, 3 Mar 2012

More than 52,000 employers will receive a total of about S$19 million this month under the Special Employment Credit (SEC).

The amount is for employing about 171,000 older low-wage Singaporeans in the second half of 2011.

Introduced last year, the SEC aims to encourage companies to employ more older workers by subsidising their wages.

The first disbursement was made in September 2011 and more than 51,000 companies have benefited from it so far.

An enhanced scheme was announced at this year's Budget to enable a bigger pool of older workers to qualify.

The first payment of the enhanced SEC will take place in September 2012.

Juraimi Lee has been working in the pest control management industry for more than 20 years.

The 61-year-old started as a junior technician and he has worked his way up to become an operations executive.

He said: "We inspect all the problems based on what the customers tell us. By the end of the job, if he said very good, we will feel happy, we feel proud that we did a proper job for them."

Pestbusters has 12 workers aged above 50, and most of them have been with the company for a long time.

Pestbusters has been receiving wage subsidies from the government for employing older workers like Juraimi. 

The company wants to take in more of such workers, but they are finding it hard to recruit them.

The wage subsidy scheme was enhanced this year with more companies expected to benefit from it.

But for Pestbusters, it's the job fit that matters, not incentives.

Thomas Fernandez, CEO and Chairman, said: "We had one or two who came in and tried out the job. After two days they just gave up, they said it's too taxing, they can't do this job. The reason is that they have not been doing this kind of hard labour, henceforth they say this is not the job for them."

However, Thai Express finds the Special Employment Credit helpful as older workers make up 25 per cent of its workforce.

Its HR Director Ng Yee Chong said the wage subsidy will further motivate it to take in more of such workers.

Ng said: "Definitely we have plans to increase the percentage, not because we need to increase it but we actually find that mature workers are more reliable. They have more passion in their work, they take pride in their work and it helps us fill up all the employment gaps."

The company is also trying to employ technology to be more productive in its operations.

Plans welcomed to boost special education students' employability
By Sharon See, Channel NewsAsia, 3 Mar 2012

Educators and employers have welcomed the government's plans to extend the Special Employment Credit and Workfare Income Supplement to graduates from special education (SPED) schools.

This initiative was announced in the recent Budget.

Nurul Aqila Hashari, 19, is a student from Metta School.

She is now on attachment at Mandarin Orchard, working as a kitchen helper in the pastry section - a job that she enjoys very much.

She said: "I do a lot of things like cakes, muffins, tarts. I like because it's good for me to learn more things than I do in school."

Nurul and two of her friends work under the supervision of the pastry chef, who is very pleased with their performance and wants to hire more of them.

Pastry chef, E Basker Babu, at Mandarin Orchard Singapore said: "I like their attitudes, plus when they're coming to the job, they won't discuss with anybody.

"They only focus on their job - what they're given. Sometimes I'm surprised they finish the job before what I give the timing."

Mandarin Orchard started taking in students from special education schools about a year ago through the Work Experience Programme under the Education Ministry and the Singapore National Employers Federation.

The hotel now employs nine SPED students on attachment. This is about triple the number it started with in March 2011, and it hopes to hire 15 such students by the end of the year.

In his recent Budget Statement, Deputy Prime Minister Tharman Shanmugaratnam said the Special Employment Credit will be extended to employers who hire SPED students.

Employers will get a credit of 16 per cent of the employee's wages.

Joseph Chia, director of Human Resources at Mandarin Orchard Singapore, said: "The government subsidy comes as an encouragement, but it's definitely not our purpose.

"Initially, we started this as a pilot programme with three or four people and after assessing this batch of students, we realised that it's very successful and mutually beneficial to the enrichment of the students as well as to the organisation. Therefore, we decided that we can actually take a step further from here."

Anuwar Abdul Wahab, Vice Principal, Metta School, said: "The most important thing is this - if our students are able to do the work, whether there is incentive or not, they will definitely employ them. But with this extra pull factor, it will definitely increase the focus of, hey, why not explore employing our SPED graduates."

Mr Anuwar also said extending the Workfare Income Supplement to SPED students is a good way to encourage them to work, helping them to live independently.

SPED schools said the new initiatives will improve job prospects for their students, but added that providing them with the right training is critical.

Educators, employers welcome Special Employment Credit scheme
By Sharon See, Channel NewsAsia, 28 Feb 2012

Educators and employers have welcomed the government's plans to extend the Special Employment Credit and Workfare Income Supplement to graduates from special education (SPED) schools.

This initiative was announced by Deputy Prime Minister and Finance Minister Tharman Shanmugaratnam during his recent Budget speech.

Nineteen-year-old Nurul Aqila Hashari, who is a student from Metta School, is now on attachment at Mandarin Orchard working as a kitchen helper in the pastry section.

And it is a job that she enjoys very much.

"I do a lot of things like cakes, muffins, tarts. I like it because it's good for me to learn more things than I do in school," said Nurul.

She and her two friends are working under the supervision of pastry chef E Basker Babu, who is very pleased with their performance and wants to hire more of them.

Mr Babu, who works at the Mandarin Orchard Singapore, said: "I like their attitudes. When they're coming to the job, they won't discuss with anybody left and right. They only focus on their job and what they're given. Sometimes, I'm surprised they finish the job before the timing I gave them.

"Sometimes, it's very dangerous to give this job to them but we give them training beforehand. She (Nurul) is doing a very good job now. When you train them very properly, they won't forget and they go exactly on the line. In future, I have plans to hire and when I submit the performance report to my management, I will definitely add them."

Mandarin Orchard started taking in students from SPED schools about a year ago through the Work Experience Programme under the Ministry of Education and the Singapore National Employers Federation.

The hotel now employs nine SPED students on attachment.

This is about triple the number it started with a year ago and it hopes to hire 15 such students by the end of the year.

In his recent Budget Statement, Deputy Prime Minister Tharman Shanmugaratnam said the Special Employment Credit will be extended to employers who hire SPED students.

Employers will get a credit of 16 per cent of the employee's wages.

Director of Human Resources from Mandarin Orchard Singapore, Joseph Chia, said: "The government subsidy comes as an encouragement but it's definitely not our purpose. Initially, we started this as a pilot programme with three or four people and after assessing this batch of students, we realised that it's very successful and mutually beneficial to the enrichment of the students as well as to the organisation. Therefore, we decided that we can actually take a step further from here."

Vice Principal of Metta School, Anuwar Abdul Wahab, elaborated on the students' employability.

"The most important thing is if our students are able to do the work. Whether there is incentive or not, they will definitely employ them. But with this extra pull factor, it will definitely increase the focus of exploring the opportunity to employ our SPED graduates."

Mr Anuwar also said extending the Workfare Income Supplement to SPED students is a good way to encourage them to work and helping them to live independently.

SPED schools said the new initiatives will improve job prospects for their students, but added that providing them with the right training is critical.

How effective is Special Employment Credit?
By Saifulbahri Ismail, Channel NewsAsia, 20 Feb 2012

The enhanced Special Employment Credit (SEC) is widely seen as an effective tool to encourage companies to employ older workers.

Under it, employers will receive up to eight per cent of monthly wages.

However, some economists believe the effectiveness of the wage subsidy could be reduced by the rise in CPF contribution rates for these workers.

Workers at Makino Asia used to climb tall racks to collect engineering parts -- an activity that can be dangerous and time consuming.

But the precision engineering company started using an automated vertical storage system just last month.

This job redesign has helped reduce the number of workers required for the job and increase efficiency by 40 per cent.

Such effort has attracted more locals to work on the factory floor.

Singapore Manufacturers' Federation deputy president and Makino Asia president and CEO Moh Chong Tau said: "Why we have foreign workers is mainly because the locals didn't want to work in this kind of environment.

"One thing is to encourage (developing) better working environment, better pay and hopefully government also encourages people to put pride in these kind of jobs."

The company believes the SEC wage subsidy will motivate them to hire more older workers.

Dr Moh said: "The SEC will help to reduce eight per cent of the cost on labour.

"This can be passed on to the employee and if there are fewer foreign workers, the levy savings can also pass on to the local older workers that will enlarge their income level."

Economists said the wage subsidy is similar to the Jobs Credit Scheme introduced during the last recession, but with some differences.

SIM University Business Programme head Randolph Tan said: "One factor that is actually in favour of the Special Employment Credit -- which is not present in the earlier Jobs Credit Scheme -- is the fact that the Special Employment Credit is a long-term scheme, so employers can be much more confident they have much more time to wait, to see how it works out, and perhaps to try to see whether it works for them as well."

However, the increase in CPF contribution rates for older workers may reduce its effectiveness.

Associate Professor Tan said: "This offsetting CPF contribution rise, that's very small of course, but if that is increased over time, that will offset to some extent, the efficacy of the Special Employment Credit."

Legislation was also enacted this year to encourage employers to re-employ older workers.

A programme to raise productivity and enhance the well-being of older workers has already begun.

It's called the Silver Productivity programme organised by the Singapore Manufacturers' Federation.

The first intake of this programme is targeted to kick-off next month.