Tuesday 20 May 2014

Will we have JOBS next year?

The first batch of Singaporeans re-hired at age 62 in 2011 will turn 65 this year. Can they continue working beyond 65? Amelia Tan, Toh Yong Chuan and Joanna Seow report.
The Straits Times, 17 May 2014

MR STANLEY Tan turned 65 this week, and that meant saying goodbye to his job as a technical executive of over 40 years.

The former statutory board employee says he will miss going to work each day.

He was in the cohort of workers who were the first to benefit from the Retirement and Re-employment Act passed in January 2011.

That law, which kicked in a year later, made it mandatory for bosses to offer healthy workers who have performed satisfactorily re-employment from ages 62 to 65, or a one-off payment.

But for many in this batch of 2011/2012 who, like Mr Tan, want to continue working, time is fast running out.

That is because those who were re-hired after turning 62 in 2011 and 2012 will reach their re-employment age ceiling of 65 either this year or next year.

Their employers are not legally bound to keep them on their payrolls.

They will not be unless the Government activates a clause in the law to raise the re-employment age to 67.

Although Prime Minister Lee Hsien Loong indicated in his May Day Rally speech this year that the Government intends to do so, he gave no timeframe.

The question is: Will the change come too late for some of these older workers?

Target was 67 all along

FROM as far back as 1993, the Government had made it clear that its target retirement age was 67.

That was the year Parliament amended the law to raise the retirement age from 55 to 60. Then Labour Minister Lee Boon Yang told the House: "The Bill will also provide for the retirement age to be raised to 67 years in the future. It is the Government's intention to do so within the next seven to 10 years."

So in 2011, when the Government amended the law to introduce re-employment until the age of 65, it wrote into the law a further two-year extension until age 67.

Then Manpower Minister Gan Kim Yong said that the extension will come "at a later stage".

National Trades Union Congress (NTUC) deputy secretary-general Heng Chee How told Insight last week that the time is ripe to discuss this extension. "67 is a reasonable next step. It makes things less open-ended and less frightening for employers," he says.

Economists agree that a two-year extension will go down better with firms which worry about burgeoning costs.

Still, firms need time to adapt. They will have to re-design jobs, salary scales and human resource policies to cope with these significantly older workers.

That is why the analysts predict that a higher re-employment age will come only two to three years down the road.

National University of Singapore (NUS) associate professor Hui Weng Tat explained there is "no real urgency" to raise the re-employment age now as bosses are already hiring many seniors due to a tight labour market.

"The conversation on this impending change, however, should happen now," he says.

Economists say the discussion should go beyond what the new re-employment age should be, and seriously consider doing away with an age ceiling completely.

Singapore Management University (SMU) don Hoon Hian Teck fully expects firms to baulk at the idea, as they may think workers will want to "stay on forever".

"This is not true. Workers will naturally exit the labour force. They too want time for themselves and families," Professor Hoon said.

Another formulation might be to keep the three-year extension beyond the official retirement age, but raise it from 62 to 64. This would then cover re-employment up to age 67.

Whichever road Singapore takes, what is clear is that it will be met with considerable pushback from employers.

Says NUS labour economist Shandre Thangavelu: "It is true that older workers are harder to train. They also cost more because of medical costs and pay. Firms must see the benefits of hiring them."

Unwilling employers?

IN FACT, opposition from employers is why tripartite talks to raise the re-employment age to 67 have yet to bear fruit, hinted NTUC's Mr Heng.

"If employers were more enthused, we would have done it (raise the re-employment age) by now," says Mr Heng, who is also Senior Minister of State in the Prime Minister's Office.

Singapore National Employers Federation (SNEF) president Stephen Lee disagrees. "We think employers are unprepared for a quick extension to 67 on the same terms... rather than they are not enthused," he says.

The good news is that there are signs that employers are starting to listen.

According to a Manpower Ministry survey last year, 67.1 per cent of Singapore residents aged 55 to 64 had jobs, a significant increase from 47.3 per cent in 2003.

Another official survey has found that private sector companies re-hired nearly all workers who turned 62 last year, and two in three did not suffer pay cuts.

Heartened by these figures, Mr Heng said he is optimistic that he will soon get buy-in from the influential SNEF. "We will continue to push... and aim to get consensus this year," he said.

On the ground, it is a matter of convincing employers that older workers remain productive and valuable.

When 64-year-old training coordinator Wong Kah Hoi knocked on the doors of consultancy firm Absolute Kinetics Consultancy looking for a job in March, his boss offered him a permanent contract despite his age.

"I was so glad that my boss recognised my experience," he said.

His boss Fang Koh Look, 45, said: "I will hire workers as long as they can contribute. Age is not an issue."

Mr Wong is among 12 older workers interviewed by Insight over the past two weeks on their re-employment prospects. Of them, at least 10, including Mr Wong, have been re-hired or have been promised jobs by their companies.

But not all employers are supportive.

They said that notwithstanding the labour crunch, they would still be far less enthusiastic about re-hiring older staff in middle-level to senior positions, especially if these workers expect to continue drawing the same salary.

Having older workers in managerial positions also affects renewal, firms added. Faced with poor prospects for promotion when their bosses hang on to the senior posts, capable younger workers will quit.

Cost is an issue too.

Some bosses, who spoke on the condition of anonymity, said they may have retained older staff at their same pay from 62 to 65 even though they have not been as productive to "help them save face". These same bosses are facing cost pressures and do not relish the thought of carrying the workers for another two years, said one owner of a small to medium-sized firm.

"We want them to have a graceful exit. But if we have to keep them longer, up to 67, we may think twice," he added.

SNEF's Mr Lee agreed that firms are facing problems in re-hiring older professionals because of the lack of suitable roles in their companies.

He believes that allowing them to be transferred to other firms for different jobs and different pay or offering them phased or partial retirement will help.

"More flexibility is required to tackle this challenge," he said.

Finding a middle ground

THE middle ground is to re-hire older staff at less senior roles and lower pay, since they have fewer responsibilities.

This was also the advice given by PM Lee in his May Day Rally speech when he told older workers that "rather than doing the same job at same pay, please be prepared to do suitable jobs at reasonable pay".

Workers seem open to this suggestion. About 70 per cent of 50 workers aged above 55 interviewed by The Straits Times, a day after PM Lee delivered his speech, said they want to continue working, even if it means getting less pay.

NTUC assistant secretary-general Zainal Sapari agreed that generally workers will accept lower pay if their workload is reduced. However, he still comes across workers who have suffered pay cuts for doing the same job.

Holland-Bukit Timah GRC MP Liang Eng Hwa said such abuses can be prevented if there is a "transparent appeal mechanism".

Economists, however, believe the solution is to avoid a situation of employing too many highly paid but unproductive older workers from the onset.

SMU's Prof Hoon said this problem comes about because many firms practise the "deferred wage compensation model". It pays lower salaries in the early years of workers' careers but higher wages later to motivate them.

This is cost-efficient when a worker's pay over his whole career is calculated. But it also means that at some point later on, he will be paid more than his current productivity.

"The solution is to pay according to performance. Reward workers for tangible results," says Prof Hoon.

Lower salary aside, older workers welcome the prospects of working longer.

Said 65-year-old lifeguard Edwin Quek: "As long as I am fit, alert and pass the annual medical test, I want to continue (in this job) for as long as I can."

For now, workers like Mr Quek will have to rely on having progressive bosses who are willing to continue hiring them beyond 65, unless the re-employment age is raised soon.

But for some, any change may be already too late.

Said Mr Stanley Tan with a sigh: "I want to continue working for a few more years as work keeps me happy. It is a pity I will not benefit."


My colleagues call me "da jie" (elder sister). It feels good to give advice and help others solve their problems. I have been with the company for 26 years so I have a lot to share. Work can be tiring sometimes but overall I still can cope. Most importantly, I enjoy my work. My bosses are understanding when I need to take urgent leave to take care of my granddaughter. I want to continue working as long as my health is good and my company needs me.

- Madam Helen Gan, 64, guest services secretary at Fairmont Singapore & Swissotel The Stamford


I would be lost if I wasn't working, especially because my husband passed away from cancer three years ago and I don't have children. My colleagues and supervisors understand that I am private and don't like to share much. After I lost my husband, I stopped having meals at the canteen because I wanted some time alone. They noticed this and showed concern by asking me to remember to eat. I was very touched. I look forward to coming to work every day as I get to see them. My colleagues are like my family."

- Madam Joanna Png, 64, a part-time room attendant at Concorde Hotel for 25 years


Many people say I look 50-plus. That makes me happy. I keep myself young by working with young people. I am inspired by their fashion. You don't have to wear dark colours just because you are in your 60s. I wear a lot of bright colours! More importantly, I don't feel old and keep positive. I want to continue working for as long as I can.

- Madam Peggy Chia, 64, an admin and customer support executive at OCBC for 12 years


I don't see why they have to take so long to change (the re-employment age); it's a ray of hope for older citizens. If you force people to retire, it's like telling them, "Your job is done, get lost". These are pioneers who helped the company from the early days! I don't know what's going to happen after I turn 65 next year, but if they can put the extension into practice by then, that would be wonderful. My daughter is still studying in university, and if she's going to do further studies she will need the support. My boss was saying if my medical records are good, the company may give me a six-month extension, so I'm keeping my fingers crossed.

- Mrs Indra Mohan, 64, an administrative assistant at an energy trading company for more than 35 years


In Singapore you must work. If you rest too much, you will fall sick. I've been covering the Shenton Way beats for 14 years. It requires a lot of concentration. I need to plan the route to avoid certain times when the lifts are too crowded, or to deliver registered mail to people. People expect their letters to be in at the same time every day, especially if they're waiting for important letters or cheques.

- Mr Abdul Sarip Naharawi, 64, a postman at Singapore Post for 22 years, vice-president of the International Sepaktakraw Federation and president of the Singapore Sepaktakraw Federation


When I turned 62, people told me I should take a break and try waking up at 9am instead of 5.30am, and I did think about it. Sometimes when you're older you want to do your own things, and sometimes you feel a little bit like, hey, am I missing out? But I still enjoy my work very much, and I feel like I've so much more to give. I believe this is where God has placed me. My contract lasts till the end of the year, and I'm not sure what will happen after that but I've applied for a reduced load as I would like to work at a slower pace.

- Mrs Tay Poh Imm, 64, teacher at Methodist Girls' School for 43 years and president of The Girls' Brigade Singapore


I like working here because the colleagues and bosses are nice, and the benefits are good. It's like a family. There are even regular customers who come every day. One family gave me presents for Christmas and Chinese New Year, like tonics and chicken essence. I gave them a turkey in return. The money I earn supports my 91-year-old mother and myself. I hope I can keep working until I am no longer able to do the work.

- Ms Soh Sock Keow, 64, senior service crew member at Han's Cafe, has worked with the company full-time for 15 years and also before that as a part-timer


By extending the re-employment age, the Government is showing that it is not writing older workers off. Employers should not write older workers off too.

If you stop working at the retirement age of 62 and life expectancy is over 80, what are you going to do for 20 years? It is important to keep occupied.

- Mr Wong Kah Hoi, 64, training and assessment coordinator with local consultancy firm Absolute Kinetics Consultancy


I have seen people who go into retirement and within six months, they become mentally retarded.

Those in their 60s - as long as they maintain a healthy lifestyle, do not have bad habits like smoking or drinking, watch what they eat - can stay healthy and keep working. As long as I am able and healthy, I want to keep working. It is important that bosses recognise that older workers can still contribute.

- Junior executive Roger Lee, 64, who works 12 hours a day, six days a week, handling the rostering of guards at security firm Soverus


Of course I can't match the younger lifeguards in their 20s in swimming speed and reflexes, but older, experienced lifeguards are calmer and more composed, and we don't panic. For now, I can still pass the weekly test of swimming 400m (eight laps) in less than 11 minutes. My time is about nine minutes. I also exercise in the gym and mentally I am still very alert. One day, my reflexes will slow and I can maybe do the job for another three or four years. As long as I am fit, alert and pass the annual medical test, I want to continue (in this job) for as long as I can.

- Hougang swimming pool lifeguard Edwin Quek, 65, lifeguard for 33 years

'Rocket Man' is ready for any job
By Joanna Seow, The Straits Times, 17 May 2014

AT 5.30am every day, Mr Lim Sin Gee gets up. After reminding his son to get out of bed, he heads out on a motorcycle to eat breakfast.

Then the well-built man, who turns 65 next March, climbs into the white cab of his lorry crane and begins his work. He does not return home until 10pm or 11pm sometimes.

This is routine for him. It did not change when he turned 62, and he hopes it will continue. "I enjoy driving and I know that I'm earning money to support my family, so that keeps me satisfied," he says in Mandarin.

The worksite he drives to starts below the Kranji Expressway and stretches 1.8km down Woodlands Road. He has been on this project for more than half of his eight years with construction company Lum Chang Building Contractors.

Sporting a luminescent vest, hard hat and whistle, the father of two spends his days - all seven days a week - ferrying materials. The crane boom helps him load and unload heavy items like timber from the lorry.

As the oldest worker on site, Mr Lim admits he sometimes scolds other workers if he sees them doing things messily or too slowly. This knack for efficiency has earned him the nickname "Rocket Man" among co-workers. His tanned but barely wizened face breaks into a smile: "Everyone calls me 'uncle' or 'older brother'. Even the foreign workers will ask me to eat or drink."

Mr Lim supports his family of four with his pay of around $3,000 a month. His wife, 59, takes on odd jobs occasionally. His daughter, 25, studies part-time and works to pay for her tuition fees, and his son, 20, is doing his national service.

"My son might continue studying after that, so I must work until he can earn his own money," says Mr Lim.

His daughter, Joyce, says she is proud of him for being able to work at this age and remain fit and healthy. "But I wish he could retire next year as I think he really needs a break from his work as he has been supporting our family all this while."

While other workers worry about whether or not they will be re-employed, Mr Lim does not think about it. "When the time comes around every year, the 'up there' will call me up to go for the medical check-up, and then they send me a contract letter to sign," he says.

And so far the firm has found his work up to scratch. "His work is not easy," says Mr Lim's supervisor, assistant project manager Chern Chee Kheang. "He has to repeat the same job over and over, keep to site access schedules and deal with a lot of people every day."

Mr Lim has a kept a clean record, with no speeding or near misses. He rarely goes on urgent leave or medical leave, Mr Chern adds. "With his skills, positive attitude and dedication to the company, the answer is a big 'yes': we will continue to hire him as long as he is healthy and willing."

In his straightforward manner, Mr Lim says that he is definitely willing. "If there is a job for me, I'll do it. If I can't stay on in this job, I'll have to find another, even if it is sweeping the roads," he says.

"Someone has to provide for the family."

Six things older workers need to know
The Straits Times, 17 May 2014

1 Central Provident Fund (CPF) withdrawal age of 55

Workers who reach 55 can withdraw a portion of their CPF savings, after setting aside a Minimum Sum for their retirement and medical needs. Those who cannot meet the Minimum Sum - currently $148,000 but increasing to $155,000 from July 1 - can still withdraw at least $5,000.

Those who have at least $40,000 in their retirement account at age 55 will automatically be enrolled in the national annuity scheme, CPF Life. They will start receiving annuity payments from the drawdown age.

2 CPF drawdown age of 63

From age 63, workers can start receiving monthly payouts from the Minimum Sum that they set aside at age 55.

The payouts could be in the form of annuity payments or balances that are kept with the CPF Board or banks.

The drawdown age will increase to 64 in 2015 and 65 in 2018.

3 Pay cut at age 60

The law allows employers to cut the pay of workers at age 60, even if the workers are doing the same jobs. The pay cut cannot exceed 10 per cent.

This was the compromise reached among employers, unions and the Government when the retirement age was raised from 60 to 62 in 1999.

4 Retirement age of 62

This is the age where workers can choose to stop working, if they want to. Singapore does not have a compulsory retirement age. Rather, there is a statutory minimum retirement age, meaning employers cannot fire workers below the age on grounds that they are too old.

The minimum retirement age is now 62 but the law allows the Manpower Minister to raise it to 67.

5 Re-employment age of 65

This is the age until which employers are required to re-hire older workers who are healthy and whose work performance is satisfactory.

When the law was passed by Parliament in 2011, it set the re-employment age at 65, but there was also a provision in the law for the Manpower Minister to raise the re-employment age to 67.

The Government has made it clear that the re-employment age will eventually be raised to 67, but no timeline has been set.

6 Employment Assistance Payment

This is a one-off "golden handshake" payment that firms can give their older workers who qualify for re-employment, if they cannot find suitable jobs for them within the organisation.

While the payment is required by law, the amount is not stipulated. The National Trades Union Congress, Singapore National Employers Federation and Manpower Ministry recommend that the amount be between $4,500 and $10,000.

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