SINGAPORE — The National Wages Council’s (NWC) call last year for a minimum S$50 pay increase to employees earning less than S$1,000 a month has resulted in rank-and-file employees receiving higher basic wage gains last year compared to junior and senior management employees.

This marked the first time, since comparable data were first collected in 1998, that basic wage growth increased over the year for rank-and-file employees, while it slowed for those in junior and senior management.

According to the Ministry of Manpower’s (MOM) Report on Wage Practices released yesterday, rank-and-file employees saw a basic wage gain of 4.3 per cent last year, compared to 4 per cent in 2011.

Meanwhile, those in junior and senior management received basic wage gains of 4.9 per cent and 4 per cent for last year respectively, compared to 5.1 and 4.3 per cent for 2011.

And while junior and senior management employees saw a higher total wage gain than their rank-and-file colleagues, the gap between management employees and rank-and-file employees’ total wage gain narrowed to 0.4-percentage point last year, compared to 1.2 percentage point in 2011.

The NWC’s call last May broke a 28-year run of issuing broad recommendations. Releasing its annual guidelines last week, the NWC again set a specific target for companies, urging them to raise the pay of those earning less than S$1,000 by S$60.

The MOM report, which examined employers’ adoption of a flexible wage system and changes in their employees’ wages, was based on data from a survey carried out between December last year and March this year, involving 4,694 private companies with at least 10 employees each.

The report also noted that while total wages for workers in the private sector increased by 4.2 per cent last year, their real wages declined by 0.4 per cent after taking inflation into account.

But after imputed rentals on owner-occupied accommodation (OOA) were excluded from the Consumer Price Index (CPI), which reflected the actual cash expenditure of households, real total wages rose by 0.5 per cent last year. The figures, according to the report, reflected the weaker economic conditions in 2012, compared to 2011.

In 2011, total wages for private sector workers increased by 6.1 per cent while real wages increased by 0.9 per cent, after taking inflation into account using the CPI. Meanwhile, their real wages increased by 1.9 per cent after adjustment using CPI without the OOA.

Labour Member of Parliament Ang Hin Kee welcomed the report’s finding of a higher increase in basic wage for rank-and-file workers.

“In fact, that is what we have been advocating — because the base of rank-and-file compared to that of either junior or middle level management is already smaller. So a higher percentage wage increase is only fair to them and what we’ve been pushing for,” he said.

Fellow Labour MP Zainal Sapari, however, was more cautious about the finding, as he noted that some rank-and-file workers may have been left out of the NWC’s recommendation for a built-in wage increase.

“Even though it shows that rank-and-file workers have actually experienced an increase in real wage, the impact might not have been across the board for all rank-and-file workers. I feel that many of the low-wage workers that are working are under outsourced contracts, may not have experienced such an increase in real wage.

“And that is the reason why this year, for NWC’s recommendation, we made special mention for companies, as service buyers, to work with their service provider to see how they could actually effect this S$60 built-in wage increase for the outsourced workers working for their company,” he said.

Mr Zainal also said the Government “should be very proactive in encouraging non-unionised companies to adopt the NWC’s recommendation” this year, adding that business organisations and chambers of commerce should encourage their members to do likewise.

“We know that it will be a challenge to actually get companies to adopt the NWC recommendations, to award the S$60 built-in wage increase to their outsourced workers, because contractually they are actually not obliged to do so,” he added.

The MOM report noted that a large majority of employees in the private sector were under some form of flexible wage system, “following a general uptrend” in the implementation of flexible wage measures recommended by the tripartite partners representing employers, workers and the government in 2004.

In December last year, 87 per cent of private sector workers had one of the flexible wage components recommended by the tripartite partners, compared to 76 per cent in June 2004, the report noted.