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Business News/ Industry / Human Resource/  Singapore to tighten salary criteria for foreign workers

Singapore to tighten salary criteria for foreign workers

Foreign labour was a hot-button topic in last year’s elections due to the perception of unfair hiring practices against locals

Lee Hsien Loong said the plan to tighten the salary criteria for foreign labour won’t be done ‘suddenly or sharply,’ but ‘gradually and progressively’ (AFP)Premium
Lee Hsien Loong said the plan to tighten the salary criteria for foreign labour won’t be done ‘suddenly or sharply,’ but ‘gradually and progressively’ (AFP)

Singapore’s prime minister sought to allay widespread concerns about the foreign workforce, pledging his government will further tighten the visa criteria for expatriates, raise salaries for low-income labourers and hold companies to account for their hiring practices.

Lee Hsien Loong said the plan to tighten the salary criteria for foreign labour won’t be done “suddenly or sharply," but “gradually and progressively" as he also looked to quell concerns from companies and show that Singapore wants to keep policies outward looking to accept competition. 

“We have to acknowledge the problem, so we can address Singaporeans’ legitimate concerns, and defuse resentments over foreigners," Lee said Sunday at a national day rally, which is seen as a key policy speech in the country’s political calender. “Only thus can Singapore remain open, and continue to grow and progress," he added. 

Lee said it was imperative for the country to reopen to the world after largely shutting its borders early last year, just as it reached a milestone to fully vaccinate 80% of its population -- outpacing most advanced economies. 

Foreign Labour 

Foreign labor was a hot-button topic in last year’s elections due to the perception of unfair hiring practices against locals and still-low wages for blue-collar workers amid rising costs and a pandemic that had, on and off, shuttered parts of the economy. 

This discontent, amid the country’s worst-ever economic slump, had played a big part in leading the ruling People’s Action Party to its weakest ever showing in the polls in July last year. A month later, the government raised the minimum qualifying salaries for employment pass holders -- in managerial or specialized roles as well as the financial services sector -- and for those with “S Pass," or mid-level technical staff.

Lee said there were often complaints over the hiring practices in the tech and financial sector. He noted however, that these companies are regionally and globally focused and the skills required for the roles are in short supply.

“Had we not allowed them to import the EPs they needed, the companies would not have come here, and Singaporeans would have had fewer opportunities," Lee said in reference to the coveted employment passes for foreign workers.


Nevertheless, Lee said the focus will be on hiring practices with the government planning to pass anti-discrimination laws for the workplace that can carry penalties. It also intends to set up a tribunal to protect workers against “discrimination based on nationality" among other unfair employment practices based on gender, religion and race.

“This will give them more teeth, and expand the range of actions we can take," Lee said of the anti-discrimination guidelines. Until now “the government has held back, because we did not want the process to become legalistic or confrontational.

Lee also unveiled other measures to ensure higher salaries for Singaporeans. Companies employing foreigners will now need to pay all their local staff a qualifying salary of at least S$1,400 ($1,040) a month, compared to earlier rules stipulating that the number of locals getting such a salary depended on how many foreign workers were employed.

Low-Wage Workers

The premier also focused on low-wage workers, saying Singapore must offer more protections for the group that has been on the front-lines since the start of the pandemic, delivering food, or employed as cleaners and working security.

Most of these workers, which number about half a million, don’t pay taxes and have, instead, gotten salary top-ups and pension contributions from the government. Such payments to these workers cost about S$850 million yearly and Lee said the government will raise annual contributions to S$1.1 billion in two years. 

Lee took aim at food delivery apps linked to Delivery Hero SE’s Foodpanda, Grab Holdings Inc. and Deliveroo Plc, saying he was “especially concerned" with their delivery workers who have no employment contracts, lack basic job protections and earn modest incomes that make it difficult to afford housing, healthcare and retirement. 

“More people are taking up this type of work, so this problem is growing. MOM is studying it, and will be doing consultations," Lee said in reference to the manpower ministry. “We must address the issues to give these workers more secure futures."

Racial Harmony

Lee devoted a significant part of his speech to racial harmony, noting that there have been racist incidents that have gone viral on social media and specifically targeted Indians -- both foreigners and local. He said these could have been sparked by the fact that a large number of foreign workers are from India and the Delta variant of Covid-19 first emerged in the South Asian subcontinent.

“We must address the real issues – manage the work pass numbers and concentrations, and improve border health safeguards," Lee said. 

The government will introduce new legislation on racial harmony that will house all the existing powers to deal with such issues. Currently Singapore relies on the colonial-era sedition act to deal with serious offenses involving hate crimes or racial enmity that critics in the past have said were used to suppress dissent.

Lee said there will be “softer, gentler touches" where there will be laws to order someone who caused racial offense to stop doing it and make amends by learning about the other races and mending ties. 

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Updated: 30 Aug 2021, 10:34 AM IST
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