S Pass salary criteria to be raised to S$2,400 over 2 years: Lim Swee Say

SINGAPORE — To boost the quality of foreign manpower, the Government will raise the S Pass salary criteria to S$2,400 in phases over the next two years, and extend the maximum period of employment for work permit holders from non-traditional sources.

To help employers to retain their experienced foreign workers and upgrade their workers’ skills to enjoy lower levies, additional pathways will also be rolled out for them, announced Manpower Minister Lim Swee Say on Monday (March 5).

Changes to S Pass minimum qualifying salary will take place in two stages: From January next year, it will go up from S$2,200 to S$2,300. The second increase to S$2,400 will take place from January 2020.

The move is part of measures to make the country’s “one-third foreign better”, said Mr Lim, noting that locals currently make up two-thirds of Singapore’s workforce at 2.3 million, while foreigners form one-third or 1.1 million.

To help with the transition, he said passes that expire before each stage of increase will be allowed to renew based on the existing criteria.

Passes that expire between Jan 1 and June 30 after each increase has kicked in can be renewed for only up to one year, while those that expire from July 1 in the year of the hike will have to meet the new renewal criteria.

To encourage firms to improve the quality of their foreign workers and improve productivity, Mr Lim also said the maximum period of employment for work permit holders from non-traditional source markets will be increased from May 1 this year.

The maximum period of employment for higher-skilled workers in construction, process and marine shipyard sectors will go up from 22 to 26 years. Similarly, the limit is also increased from 18 to 22 years in the services and manufacturing industries.

Basic-skilled workers in these sectors will also see their maximum period of employment raised from 10 to 14 years.

The extension will apply to work permit holders from China and six non-traditional source countries, including Bangladesh and India, who are subjected to the maximum period of employment requirement, said MOM.

It will not affect workers from Malaysia, Hong Kong, Macau, South Korea and Taiwan, who continue to be allowed to work up to age 60.

With the same objective to improve the skills of foreign workers, from September this year, employers can also upgrade their workers’ skill status through another pathway under the Market-Based Skills recognition Framework, said Mr Lim.

At present, work permit holders in the manufacturing and marine shipyard sectors can be upgraded to higher-skilled status based on their qualifications and skills test.

The new pathway means workers in the manufacturing sector can get the higher-skilled label if they meet the four-year minimum period of employment and salary criteria of S$1,600. Those in the marine shipyard sector have to meet a two-year minimum period of employment and salary requirement of S$1,200.

Once employers have ensured their workers meet the requirements, they can extend the maximum period of employment and enjoy lower levies, said the Manpower Ministry (MOM).

“We believe this will be helpful to companies that want to hire and retain their better work permit holders,” said Mr Lim.

Noting that such frameworks have been in place for workers in the construction, process and services sectors, MOM said the additional pathways supplements the existing upgrading tracks.

At MOM’s Committee of Supply debate, Mr Lim spoke at length on the need to maximise the potential of the country’s 3.4 million workforce.

Recognising the debate over the country’s manpower policy, Mr Lim noted that various arguments have been put forth.

Businesses noted that the policy is “too tight”, as they lamented the lack of locals with the skills and willingness to do the jobs offered. “To them, MOM is not pro-business enough,” added Mr Lim.

On the other hand, locals said that there are still “too many foreigners” and “too much competition here for jobs”, said Mr Lim. “They feel our foreign manpower policy is too loose. To them, MOM is not pro-worker enough.”

However, Mr Lim emphasised that MOM aims to strike a “fine and dynamic balance” in its foreign manpower policy. It needs to be open enough to support business growth, but at the same time, tight enough to improve local employment, he added.

To illustrate the need for both locals and foreigners to complement each other, Mr Lim shared with the House an equation: two-thirds plus one-third should not just equal to one, but more than one.

Noting the importance to be both “pro-business and pro-worker”, Mr Lim said that its manpower policies are designed to improve both the quality of its local and foreign workforces.

To that end, for locals, Mr Lim said that his ministry will extend the Fair Consideration Framework (FCF) job advertising requirement from July this year to include companies with 10 or more employees, as well as for job positions with a fixed monthly salary between S$12,000 and S$15,000.

Currently, such employers and positions are exempted from complying with the framework, which requires employers to advertise job vacancies on the national Jobs Bank — managed by Workforce Singapore — for at least 14 days before submitting employment pass applications.

Introduced in 2014, the framework is meant to get companies to consider Singaporeans before hiring foreign professionals.

“These changes will ensure that the FCF job advertising requirement keeps pace with income changes, and that the local workforce continues to be fairly considered for job opportunities,” said MOM.

Noting that companies who discriminate against locals will be taken to task, Mr Lim gave an update that 500 companies have been placed on the FCF watch list thus far. The watch list tracks firms that are not doing enough to hire Singaporeans.

So far, 150 companies have improved their human resource practices and exited from the watch list, while 60 out of the remaining 350 companies have not been cooperative.

As a result, MOM has curtailed their work pass privileges, which means they cannot make any new employment pass applications as well as renew existing employment passes until they “adopt fair human resource practices”.

“We will continue to fight this win-lose mindset,” said Mr Lim. “Because it results in a waste of our precious human capital.”