MOM's assurance, advice
The Ministry of Manpower (MOM) refers to recent letters (on 10 Nov “Stricter hiring rules: Employers caught off guard, and struggling”, “Fixing an honest month's wages for pass holders”, “Work passes for supporting jobs” and on 13 Nov “More clarity needed”). We understand the concerns shared here.
The Government has been clear on its long term strategy. The strategic shift to productivity-led growth and moderating reliance on foreign manpower has been clearly articulated by the Economic Strategies Committee (ESC) in 2010.
Since then, the series of deliberate and calibrated measures to raise the quality and moderate the growth of foreign manpower, were not only introduced gradually but also phased in so that businesses can adjust. The adjustments will not be easy, and therefore a complementary package of productivity strategies and incentives was also introduced and progressively enhanced to help businesses restructure and cope with the changes. We will continue to do so.
We recognise that businesses need predictability in planning their manpower needs. MOM seeks to provide this through the online Self-Assessment Tool (SAT) (http://sat.mom.gov.sg/), for employers to assess if their potential or existing foreign employees will meet the prevailing eligibility criteria for Employment Passes and S Passes. Many companies and their recruitment agencies continue to put in applications for candidates which would be assessed to be ineligible if they had tapped on the Self-Assessment Tool. We urge companies to make full use of the online tool.
Enabling companies to grow and succeed is critical to Singapore, because only when companies prosper and thrive can Singaporeans enjoy better jobs and rising wages. Therefore, even as we raise the quality and moderate the growth in foreign worker numbers, we continue to allow companies to access necessary skills and talents needed to remain competitive. Foreign manpower will remain essential and complementary to our local workforce.
We assure businesses that any policy changes will be made known early to give companies reasonable transition time to make adjustments. We will continue to engage and obtain feedback from our stakeholders, both the business community and the unions, on our policies and processes.
Stricter hiring rules: Employers caught off guard, and struggling
The Ministry of Manpower should have given employers a more reasonable notice period regarding its new policy that results in stricter terms for the hiring of foreign labour ("Have we gone too far?").
There were four problems that caught employers like me off guard.
First, the new policy said that pay for experienced foreigners on employment passes must be above $3,000 monthly, but the exact minimum pay was not announced.
When I renewed my applications for my staff, I was surprised to learn that the new pay must be at least $4,500 monthly, which is 80 per cent more than the $2,500 from two years ago.
I did not have enough time to build a sufficient quota to downgrade my foreign staff to S Passes, or to recruit replacement local workers.
Singapore is now at full employment, so local job applicants are rare.
Second, employers value and treasure staff they have trained and who have worked hard to contribute to their businesses.
The ministry's drastic policy change has forced employers like me to grapple with the issue of losing valued staff, or retaining them at significantly higher pay, thereby eroding profits.
Third, the new policy has turned the hiring process into a local employees' market.
These workers resign without notice during employment, do not report for work after signing an employment contract, or do not turn up for job interviews that were scheduled.
Local employees also quit if the job is demanding, as they can find employment easily elsewhere.
Employers are now at their mercy.
Finally, there is a limit to automation, which varies depending on the job requirements.
As auditors, the authorities require us to verify our clients' hard copy source documents, which requires manpower.
I urge the Manpower Ministry to review the practical issues arising from the new policy on foreign labour, which will affect new job creation in the face of a looming world economic downturn from which Singapore is unlikely to be unaffected.
Tan Saw Bin (Ms)
ST Forum, 10 Nov 2012
Fixing an honest month's wages for pass holders
I was surprised to learn that one criterion for an Employment or S Pass is an applicant's monthly basic salary when the way pay is structured today is based on an employee's annual total cash or annual total target cash (ATTC).
The structure is predicated on a pay-for-performance philosophy, under which most employees are paid a fixed or guaranteed base salary plus a variable component, which is tied to a company's business results and the individual's performance or contribution to the bottom line.
The general rule is that the higher one is on the corporate ladder, the greater the variable component of one's ATTC.
So, while a non-management employee may have a variable component that makes up only 8 per cent of his ATTC, his manager's variable component could well be as high as 30 per cent.
Thus, a manager earning $6,000 per month would have an ATTC of $101,400, which includes his 30 per cent performance bonus.
So it would appear that the work pass criterion ignores the variable component - and even allowances. This results in an incorrect reflection of the applicant's true worth.
The Ministry of Manpower should review how it calculates the baseline salary that qualifies a person for an Employment or S pass.
Most employment contracts these days spell out not only an employee's monthly base salary but also additional payments such as fixed allowances and/or variable performance bonuses.
If the ministry does not address this issue, a situation may arise in which professionals employed in a managerial capacity find their Employment Pass rejected upon renewal.
Matthew Ong
ST Forum, 10 Nov 2012
Work passes for supporting jobs
The latest changes in assessing the eligibility of top-tier foreign talent for the Personalised Employment Pass (PEP) are timely ("Stricter criteria for personalised work pass"; Wednesday).
But why tie eligibility only to an applicant's annual income?
It would be useful if the Manpower Ministry gave clearer information about the assessment criteria used in granting Employment Passes and the PEPs.
According to the ministry, the PEP remains a premium pass for top-tier talent; in other words, it is targeted at attracting highly skilled foreigners to Singapore.
But what are the criteria used in determining that the skills they possess qualify them for the PEP?
Are foreigners who take up jobs in supporting administrative functions like human resources, accounting, finance and operations in Singapore regarded as being highly skilled?
Singapore has been a regional hub for many multinational companies for a long time, and many Singaporeans have years of experience as regional heads in these support staff functions.
The ministry should provide more details of the number of employment passes granted yearly, and the number of renewals that were approved and rejected.
Of the total, what is the number of employment pass holders in jobs that deal with support staff functions?
This will help in ascertaining how many mid-tier foreign managers were granted employment passes, and in identifying the special expertise they have, if any, that Singaporeans do not.
Grace Chua (Ms)
ST Forum, 10 Nov 2012
More clarity needed
I agree with several of the points raised in the report ("Tightening foreign labour inflows: Have we gone too far?"; Nov 3).
The Manpower Ministry's succession of rapid changes to foreign manpower policies on S Passes, Personalised Employment Passes and Employment Passes is creating uncertainty for employers.
Consistent policies were the hallmark of our country, and were among the key reasons why many foreign companies decided to set up shop here.
What if the latest changes cause foreign investors to move their operations to neighbouring countries?
This would lead only to job losses for Singaporeans.
Many companies have set up their Asia-Pacific headquarters in Singapore at the invitation of our Government.
If they are not allowed to bring in talent from their overseas operations, then they will simply relocate elsewhere.
Where would that leave young Singaporeans who hope to enrich themselves with regional roles and the invaluable experience that comes with them?
What adds to the confusion is that some ministers talk about how restricting foreign labour impacts small and medium-sized enterprises, while others mention the need to further restrict the entry of foreign manpower.
We are also told to increase worker productivity and leverage technology so we can rely less on foreign labour.
This rhetoric is not unfamiliar, but are there any specific suggestions on how we can do so?
Matthew Ong
ST Forum, 13 Nov 2012
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