Speech by Mr Lim Swee Say, Minister for Manpower at the Tripartite Event on Fair and Responsive Management of Disputes for All Employees

20 Oct 2017Speeches

Brother, Chan Chun Sing, Secretary General, NTUC

Brother, Dr. Robert Yap, President of SNEF

Tripartite Leaders, Partners and Employers Brother, Chan Chun Sing, Secretary General, NTUC

Brother, Dr. Robert Yap, President of SNEF

Tripartite Leaders, Partners and Employers

Brothers and Sisters

Labour-management relations in Singapore has remained harmonious. We continue to enjoy industrial peace.

This is something we have worked hard together for many years and something we can all be proud of. Even so, disputes will arise from time to time. It could be due to lack of understanding of HR practices, or lack of communications, or lack of resources. When this happens, affected parties – both employees and employers – can be under a lot of stress.

What the tripartite partners strive to do, is to keep strengthening our dispute management mechanisms so that more of such disputes can be resolved in a cheaper, better and faster manner for both employers and employees.

These are the reasons why The Tripartite Alliance for Dispute Management (TADM) opened its doors six months ago:

Firstly, to help more categories of employees, including the PMEs who are not covered by the Employment Act.

Secondly, to help employees faced with employment disputes in a more holistic manner, going beyond dispute resolution: from legal support, to job search and financial assistance.

Third, to help employers and employees to resolve a wider range of disputes, beyond what employment laws cover.

Update on TADM’s Progress

Let me share with you TADM’s progress so far in its first six months of operation.

The first objective of TADM is to help more categories of employees, including PMEs who are outside the scope of the Employment Act.

Previously, PMEs not covered by the Employment Act (EA) could only recover unpaid salaries through the Civil Courts. Now, with TADM and the Employment Claims Tribunal (ECT)coming into operation since April this year, there is an expeditious way to resolve salary claims: first, through mediation at TADM, and if mediation fails, then by the ECT.

Between April and September this year, 4,350 employees and 250 employers filed salary-related claims at TADM. About 5% were withdrawn before mediation, usually because the claimants did not have a strong case, or they later preferred to engage the other party privately to resolve the issue.

The remaining 95% of the claims were mediated by TADM, out of which, 800 were filed by PMEs, including 300 PMEs who are not covered by the EA but are now covered following the introduction of the Employment Claims Act.5% of those who registered claims were employers, 75% were rank-and-file workers, and 20% were PMEs.

Let me share one case that was not covered by the EA but was able to benefit from TADM’s services. Ms Vijaya was an in-house consultant, earning $5,000 a month. She was not paid five months of salary from Jul to Dec 2016.She came to TADM for help when it was opened in Apr 2017.

During mediation by TADM, the employer admitted to not paying Ms Vijaya’s salary, because she did not meet work expectations according to the employer. At the same time, the company was also facing cash-flow difficulties.

Our TADM mediator explained to the employer the proper way of managing performance issues, and that it is not right to withhold salary. The employer heeded the mediator’s advice.

As the employer was facing cash-flow difficulties, he offered to pay the unpaid salaries in installments over three months. Ms Vijaya agreed and received all her unpaid salary by July this year. I think she was grateful for the help of TADM.

In total, TADM has completed mediation for 3,100 employees, with 9 in 10 of them recovering their unpaid salaries in full, amounting to about $5 million. However, it still leaves us with 1 in 10 cases where the employees did not fully recover their salaries.

In most cases of zero or partial recovery of unpaid salary, the reason is that businesses have failed. This is why we keep reminding employees to come forward early before the sums become too large, or before the company reaches the point of closing down. When workers are unable to recover their unpaid salary, they need more help from us, beyond mediation.

Hence, the second objective of TADM is to help employees faced with employment disputes in a more holistic manner.

Mr Chua was working as a cook in a restaurant, drawing a monthly salary of $1,800. He filed a claim against his employer for more than 1 month of short payment of salaries. At the mediation by TADM, the employer agreed to pay him the $3,100 owed to him. However, as the employer was in financial difficulties and had already ceased operations, he was only able to pay Mr Chua $500.

To help Mr Chua to meet his immediate needs, TADM provided him with some financial relief administered by NTUC’s U Care Centre (UCC). Mr Chua has since found a new job and we are happy for him. This is a case in which the employer was unable to pay the owed salary.

In rare occasions where employers are able to pay but refuse to pay the unpaid salary, TADM and UCC help the employees to take legal action to recover their salaries. This is done commonly through the Writ of Seizure and Sale process (WSS), by seizing the employer’s assets for auction.

In one case, two administrative workers from a fitness and recreation firm were not paid one month of salary when they resigned in January 2017.The employer did not attend mediation, and did not pay even after a payment order was issued. TADM and UCC therefore advised these two employees and guided them to carry out the WSS. When the two of them went to the employer’s premises with the Court Bailiff to seize assets for sales, the employer paid up the salary arrears in full on the spot. The claim was resolved.

We take a serious view of employers who willfully refuse to pay. So far, TADM has encountered very few of such employers. In all these cases, MOM will carry out investigations, with a view to prosecute them.

On top of the recovery of unpaid salary, some workers may need more help because some may have lost their jobs, and some may be the sole-breadwinner at home.

To provide more support, TADM brings in:

• WSG and e2i to help with career counseling, training and job placement;
• MSF’s Social Service Offices (SSO) to help them cope with their financial difficulties;
• And VWO counsellors to provide emotional support to them where necessary.

TADM has provided such help for 170 cases so far in its first six months of operation.

An example of such cases is Mr Teo, a technician working for a company in the automotive industry. He filed a salary claim with TADM against his employer, and recovered his unpaid salary in full. But even so, Mr Teo revealed that he was in financial difficulties as he and his wife had both stopped working for a few months. They needed help in providing for their child and repaying a bank loan.

TADM referred him to the SSO and the SSO officers agreed with TADM’s assessment. Mr Teo’s family was provided with financial assistance, including payment of utilities and conservancy bills. e2i is now working with SSO to help Mr Teo to find a new job.

In another case, Mr Tan resigned from his job as an Admin Assistant and made a claim for short payment of salary. Mediation was successful, and Mr Tan received his salary in full. To help Mr Tan to find a new job, our career coach helped to improve his skills in job searching such as resume writing and managing interviews. We are glad that Mr Tan has since found a job as an admin executive in a consultancy firm, with a salary similar to his previous job.

These positive outcomes show that the concerted efforts of TADM and our partners can indeed make a difference to the lives of our workers in resolving their employment disputes and more.

The third objective of TADM is to provide help for a wider range of disputes, beyond what employment laws cover. In this regard, TADM also provides advice on all employment disputes, whether or not they are covered by employment laws. TADM will provide advice on both salary and non-salary disputes, as well as in-employment and end-of-employment disputes.

In six months, 3,800 employees have come to TADM for advice, including 400 PMEs. TADM helped them better understand the employment and contractual rights of employees, and the obligations and contractual rights of employers. If further assistance is needed, TADM would provide the employees with legal advice through legal clinics offered by the Law Society of Singapore.

TADM also offers mediation for employees and employers who are willing to work out an amicable settlement between them on a voluntary basis. So far, TADM has held voluntary mediation for about 100 cases which were not covered by law but could be guided by contract or industry norms.

Most common cases are related to end-of-employment disputes, such as those related to termination (for example, whether termination was done fairly), and in-employment grievances, such as those related to performance appraisals.

Although mediation for such cases are done on a voluntary basis, it is encouraging that almost all employers (more than 90%) attended the mediation at TADM, with 7 in 10 cases settled successfully.

In one case of an in-employment dispute, Ms S, who is a manager with a financial institution, was disappointed that she had been placed on a Performance Improvement Program just two months before she turned 62.She felt unfairly targeted, and questioned if it was an attempt to deny her re-employment.

During the voluntary mediation at TADM, the employer clarified the purpose of the Performance Improvement Program (PIP). (The reason why the mediation was voluntary was because disputes related to performance appraisal are not covered by the EA and her salary was more than $4,500.) It was to help her to improve her performance, with clear goals and weekly reviews to assess her progress. The employer assured her that she would be offered re-employment once she met her KPIs.

The TADM mediator pointed out to the employer that they should have engaged Ms S earlier, at least six months before she reached the retirement age of 62, as advised under the Tripartite Guidelines on the Re-employment of Older Employees. Placing her on the Program just two months before reaching re-employment added to the mistrust between them on the real purpose of the Program.

While acknowledging and agreeing to bring their HR policies to be in line with the Tripartite Guidelines for future cases, the employer insisted that Ms S had indeed not been performing for some time. The company had already documented this and informed her a year earlier, even though she was placed on the PIP much later. However, on the other hand, Ms S insisted that she did not agree with the performance appraisal, and that she had appealed to the management but did not get a satisfactory reply. As a result, her appeal was left hanging.

After listening to one another, both parties mutually decided to end the employment relationship. Ms S accepted a goodwill payment from her employer, in recognition of her years of service and contribution to the company. The employer also offered a Certificate of Service to Ms S, indicating that she had left service due to retirement, not termination. While the outcome may not be the best from the standpoint of both the employer and employee, it is at least a mediated outcome that is acceptable to both parties.

In another case of voluntary mediation, it involved an end-of-employment dispute. Mr C was a personal driver to a managing director (MD) of a company for 3 months. He was terminated with the required one week’s notice provided for in his contract, because he was unable to drive the MD to and from Kuala Lumpur, Malaysia. Mr C felt the termination was unfair as his driving duties did not cover any area outside of Singapore.

During mediation at TADM, the company explained that the MD found new business opportunities in Malaysia. This happened after the employment of Mr C. They encouraged Mr C several times to take up the assignments of driving the MD to and from KL. However, Mr C declined repeatedly because he had no experience driving in Malaysia and did not feel confident enough to drive out of Singapore. Also, there was no mention of such a requirement in his contract. As Mr C could not perform the tasks to meet business needs, the company decided to terminate his employment and look for candidates who are able to drive to Malaysia.

The mediator explained to Mr C that job scopes could change because of new business requirements and that employers and employees should try to accommodate and work out a mutually acceptable arrangement. As no arrangement could be worked out in this case, either party could end the contractual relationship according to the terms in the employment contract. Mr C accepted the explanation and ended the employment relationship.

While the two cases of Ms S and Mr C are quite different, there is one thing in common – such in-employment grievances and end-of-contract disputes could have been better managed and resolved more amicably, if the companies had put in place more robust grievance-handling processes.

Tripartite Standard on Grievance Handling

Hence, to help more employers to adopt more progressive HR practices, we are launching a new Tripartite Standard today --the Tripartite Standard for Grievance Handling. This Tripartite Standard specifies a set of verifiable and actionable employment practices for companies to manage workplace grievances more effectively.

First, the Standard requires companies to put in place and communicate to employees a grievance handling procedure that:

States clearly the appropriate authority in the company to hear the appeal and the expected duration for action to be taken; and
Gives the employee the right to bring the unresolved grievance to the next level, or request for the assistance of the union where applicable.

Second, the Standard requires companies to commit to train their supervisors, HR and staff to ensure that grievances can be resolved effectively and amicably.

We are happy that more than 220 employers have already signed on to this Standard as early adopters. These employers include companies of various sizes across various sectors, as well as the public sector. Collectively, they employ about 245,000 employees.

The names of these employers will be listed on TAFEP’s website and in a later phase –the Jobs Bank. These employers can also display the Tripartite Standards logomark in their publicity materials for all to see.

One of the early adopters is Raffles Hotel Singapore. Raffles Hotel Singapore is undergoing an 18-month restoration programme. About 350 full-time employees were affected, and they are concerned whether they would still be employed, especially when the hotel closes in Dec 2017 for the final phase of restoration.

Raffles Hotel Singapore believes that open discussions are critical in preventing any misunderstanding and in preserving harmonious workplace relations. With the grievance handling procedures firmly in place, employees were engaged in one-to-one discussions with senior management, together with a senior member of the Talent and Culture team. This progressive approach has allowed Raffles Hotel Singapore to understand the concerns raised by the employees, and for the hotel to provide the reassurance that all possible assistance would be provided proactively.

The Talent and Culture team also worked closely with the union to allay any concerns, and to ensure a smooth transition process for the affected employees. As a result, all of the employees were either successfully seconded to other sister hotels locally or provided with assistance to find new employment opportunities. This has helped preserve workplace harmony, trust and loyalty built up between the employees and the employer, between the management and the union over many years.

We therefore encourage more employers, especially those of you who are here today, to sign on to this Tripartite Standard. Working together, we can help you build a progressive workplace in your companies.

Six months ago, at the launch of TADM, I thanked the staff of the Ministry of Manpower (MOM) (about 70 of them) for taking up the challenge to migrate from MOM to the tripartite family. Under the leadership of Mr Felix Ong, General Manager of TADM, they have achieved a lot in the first six months. Today, I thank them again. Well done.

I also want to thank our tripartite partners - the labour movement and SNEF -for their shared commitment and active contributions.

I thank The TADM@NTUC team, for working side-by-side with the TADM colleagues to help employees resolve their employment disputes.

I thank NTUC’s UCC, for extending the extra help to those who need to take legal action to recover their salary, and those who were unable to recover their salaries.

I thank The Tripartite Mediation Advisors from SNEF and NTUC, for helping the employers and employees to understand the issues behind the disputes clearer so that they can resolve their disputes better.

I would especially like to thank Sister Cham Hui Fong from NTUC, Brother Koh Juan Kiat from SNEF, Brother Then Yee Thoong from MOM for spearheading our joint efforts in strengthening the Tripartite Alliance on the ground, as well as Mr Augustin Lee, for chairing the TADM board. I would also like to thank ourtripartite partners on the Board of the Tripartite Alliance, chaired by Brother Stephen Lee.

I also wish to thank the many partners of TADM –ECT, e2i, Workforce Singapore, the Ministry of Social and Family Development’s Social Service Office, Family Service Centres, the Voluntary Welfare Organisations, and the Law Society of Singapore. Without your participation and support, we would not be able to do more for more workers and more employers.

Expanding the Scope of TADM and ECT

The good start that TADM has made has given us a solid foundation to do even more inthefuture. Having established ECT and TADM as the all-inclusive platform for the resolution of salary-related disputes, the tripartite partners are now in discussion to progressively expand the scope of TADM and the ECT to include mandatory mediation and resolution of non-salary-related disputes as the next step. In other words, TADM and the ECT can hear salary-related and some types of non-salary-related disputes from employees, whether they are covered by employment laws or under their contracts.

In particular, we are looking at including disputes relating to wrongful dismissals of PMEs who are not covered under the Employment Act. This is because such disputes have the most impact on the affected PMEs. The tripartite partners will work closely to forge a consensus, hopefully in the not too distant future.

In conclusion, there are three categories of employers --the unfair, the fair and the progressive. To discourage employers from adopting unfair HR practices, the tripartite partners will continue to review and strengthen our employment laws and to step up education and enforcement. At the same time, to encourage more employers to adopt not just fair HR practices, but also progressive human capital (HC) practices, we will continue to expand the list of tripartite standards.

The Tripartite Standard on Grievance Handling is the third Tripartite Standard launched so far, after the Tripartite Standard on the Employment of Term Contract Employees and Flexible Work Arrangements. More are in the works. The tripartite partners are in active discussion on launching even more Tripartite Standards covering areas such as recruitment practices, procurement of services, including those from freelancers, the conduct of retrenchment exercises, age-friendly workplace practices, contracting with self-employed persons, and so on.

I encourage all organisations, regardless of size and sectors, to adopt these tripartite standards. Together, we can make our workplaces even more progressive and harmonious, workforce more engaged and productive, and businesses more innovative and competitive as we strive for better growth in our future economy.