Assoc Prof Daniel Goh Pei Siong (Non-Constituency Member): Mdm Speaker, the setting up of the Employment Claims Tribunal is long overdue. This Bill is a welcome relief for workers. I am sure there will be many refinements down the road to ensure that workers get paid their rightful salaries. For now, I have a few issues that I would like to put to the Minister to address.
First, the most important feature of the Employment Claims Tribunal is that it covers workers not covered under the Employment Act, especially Professionals, Managers and Executives who earn more than $4,500 a month. The setting up of the Tribunal finally recognises that compelling PMEs to file their claims with the civil courts can be lengthy and costly, thus discouraging PMEs from pursuing their just compensation and creating the unintended consequences of protecting unscrupulous employers.
However, the obstacles faced by PMEs might return in another form with the Tribunal. This is the limit on claims amount. It was stated in the Ministry of Manpower’s public consultation exercise that claims amount would be capped at $20,000 per claim, or $30,000, if claimants go through the Tripartite Mediation Framework or MOM conciliation. I would like to clarify with the Minister if this, indeed, would be the case.
[Mr Charles Chong (Mr Deputy Speaker) in the Chair]
If so, what is the purpose of differentiating the claims limit between the two types of claimants, and why give a higher allowance to claimants going through the Tripartite Mediation Framework or MOM conciliation when these claimants have more alternative avenues to resolve their salary-related issues? Secondly, is not the $20,000 cap too low for PMEs, this being less than five months of salary for those earning $4,500 a month?
Clause 12, subsection 8, gives the Government the flexibility to prescribe different classes of employees and employers and different claim limits for different classes of claimants and different circumstances. Rather than to prescribe different classes in terms of whether they go directly to the Tribunal or through the Tripartite Mediation Framework, I believe the logical thing to do, given the differentiated employment market, is to prescribe different classes of claimants according to their salary range and set the different claim limits accordingly to ensure inclusive coverage of PMEs.
Better still, to ensure fairness to all workers, would the Minister consider a more dynamic claims limit that is pegged to six months of the claimant’s last drawn salary or $30,000, whichever is higher? The claims limit should not be pegged to the claims limit of the Small Claims Tribunal. Employment claims are by nature, by complexion and by quantum dissimilar to small commercial claims. It is very important that we send a signal to employers and employees alike that employment claims are not small claims.
The second issue is the time limit to submit a mediation request. Clause 3, subsection 2, sets out two different timings for claimants, six months after the last day of employment for disputes where an employment relationship has ended or one year after the occurrence of the dispute for other disputes, presumably where the employment relationship has not ended. This seems anomalous, as I would expect the majority of cases to fall under the former category where the employment relationship has ended.
The six-month timing is, therefore, potentially disadvantageous to the majority of claimants and also add an extra burden to workers who find themselves in the unfortunate situation of becoming unemployed and in an acrimonious salary dispute with their former employers. I believe the Government can be more liberal and understanding of the situation faced by unemployed workers by extending the timing from six months to one year. This will also equalise the timings among the different specified employment disputes under clause 3, subsection 2, making it fair for all workers.
The third issue is the question of representation before the Tribunal. Clause 5 specifies that claimants must act in person and cannot be represented by an advocate and solicitor or by an agent, paid or otherwise. On the other hand, an officer or full-time employee could represent employers for the dispute. There is a potential imbalance here that would disadvantage claimants. Companies could send their in-house lawyers or professional human resource professionals at no cost to them. In such a situation, PMEs would also be disadvantaged, not to mention rank-and-file workers and foreign workers hampered by language differences and lack of knowledge. Discretionary powers should be given to the Tribunal to allow claimants representation by advocates or agents when it is apparent that the claimants are at a disadvantage.
The fourth issue is the question of enforcement. Clause 22, subsection 11, states that a claims order made by the Tribunal might be enforced in the same manner as that made by a District Court. The Minister for Manpower said in his reply to a Parliamentary Question in May 2015 that the Ministry cleared 1,630 cases of salary disputes in 2014, but one-third of workers did not receive the full payment on the pretext that the companies who owed them salaries were facing financial difficulties. When the Ministry investigated further, 80% of the employers who did not make full payment were discovered to be able to make the full payment.
It is apparent from this that enforcement of the claim orders could be a major problem going forward, and active enforcement on the part of the Ministry is the only way to minimise the problem. The Minister said in his 2015 reply that the Ministry is looking into enhancing the protection for workers in this regard more holistically. Could we get an update on how the Ministry intends to do this to minimise non-compliance with claim orders?
Lastly, concerning the public consultation on the Bill that closed on 23 March this year, the summary of key comments received and the Ministry’s responses was not published on the REACH website or the Ministry’s website as promised. Would the Minister inform the House what are some of the key concerns the public had with the Bill and the Ministry’s responses to them? Would the Minister also please cause the summary of responses to be published online?
Notwithstanding the above issues, this setting up of the Employment Claims Tribunal is a good beginning. Mr Deputy Speaker, Sir, I support the Bill.
Mr Lim Swee Say: Mr Deputy Speaker, first of all, I thank all the Members for their views and suggestions, as well as for supporting the setting up of the Employment Claims Tribunal. Members have brought up many points. Before I respond to them to the best of my ability, let me just set the stage first, and take a step back.
In the Second Reading of this speech, I highlighted that right now, there are three avenues for workers to settle their dispute with their employers – by becoming a union member, through the Labour Court as well as through Civil Court. These three avenues complement each other. We are not trying to find one solution to replace all three because each one on its own serves a very important purpose.
For example, unions must continue to be allowed to play a very important role because if the day were to come where our legal framework becomes so comprehensive that unions no longer have a role to play, eventually the Labour Movement will become weak. When the Labour Movement becomes weak, the day will come when the workers can no longer be protected adequately in all aspects of work.
Just look at what is happening in USA today. The Labour Movement is weak; everybody recognises it. In recent years, we have heard many public reports, lamenting that the weakness of the labour movement in the USA is today a major weakness in their labour landscape. But in the case of USA, will they be able to find a way for the labour movement to be strong again? This is something for them to worry about, to think about.
In Singapore, the Labour Movement is strong, it is healthy. Tripartism is strong, it is healthy. Let us keep it that way. Therefore let me stress, firstly, that it is not our intention to weaken the role of the unions through ECT. Secondly, it is not our intention to make ECT so comprehensive that it solves all problems. ECT is meant to be a cheaper, better, faster way of resolving disputes. Cheaper – must be highly affordable, more so than the Civil Courts. Better – because it must be able to help more and more employees, including those not covered by Employment Act, to have access to ECT. Lastly, faster – we want the disputes to be resolved as quickly as possible.
Against that backdrop, let me start by saying that I know many of you will be disappointed by my response, but please bear in mind this. I think Member Mr Dennis Tan or Assoc Prof Daniel Goh said that ECT is a good start. I fully agree with him. That is our intention. We want to have a good start to ECT and this good start need not be the ending point, it is just a good start. Against that backdrop, let me try to respond to some of the specific points.
First, Mr Patrick Tay asked about apprentice and interns who are under contracts of service. Yes, they would have recourse through the ECT.
Mr Patrick Tay and Mr Zainal talked about frivolous claims. Let me assure Mr Zainal that all valid claims will be heard regardless of the claim amount. So even $50 can be a valid claim.
Mr Zainal Sapari asked whether employees filing for CPF claims can come under ECT. Deputy Speaker, non-payment of CPF contribution is an offence. Workers do not have to claim for non-payment of CPF. All they need to do is notify CPF and we will take enforcement action on their behalf.
Mr Faisal Manap and Mr Dennis Tan asked why not include foreign domestic workers. We have mentioned it before that foreign domestic workers and other category of workers already have access to separate mechanisms today. Today their claims are not under the Labour Court. ECT, for a good start, will take over the role of the Labour Court and not beyond that. Therefore, for these categories of workers, we will look to include them in future phases of implementation.
Time limit – six months, one year. It is debatable. Based on our experience in Labour Court, six months and one year would be sufficient to cater for most cases. But one important point is that based on our experience in Labour Court, evidence become harder to gather, harder to collate, as the time passed by. As a result, we believe that by imposing this time limit, it will actually force both employers and employees to take quick action. If you have a claim, make it quickly, why wait? And bear in mind, there is a limit of $20,000, $30,000.
The longer the workers wait to file their claims, the more the workers accumulate their claims, the more likely they are going to be affected by the claim limit. So, I would say that having a faster claim works to the advantage of the workers. Do not wait.
On claim limit, why $20,000? If I set it at $50,000, Members will ask why $50,000? If I say $100,000, Members will ask why $100,000? The answer is very simple. Today, the Labour Court, we have a $20,000 limit for the PMEs, for the rank-and-file, there is no limit. But we discovered that, for the rank-and-file, $20,000 is more than adequate. As a result, we decided to continue the existing claim limit of the Labour Court. But this number is not cast in concrete. We will review from time to time through tripartite consultation.
Mr Gan Thiam Poh asked why the claimants cannot recover their abandoned claim amounts in other courts. This is to avoid multiple proceedings in different courts and tribunals over the same dispute. This is in line with the State Courts' existing practice. It is not something new to the ECT.
Mr Zainal Sapari asked about the timeframe for mediation sessions. For Labour Court claims, the first session is arranged within a month, usually within 14 working days. We will continue with this best practice under the ECT.
Mr Murali asked whether new claims that may arise between mediation and ECT hearings can be combined. The answer is, yes, we will consider his suggestion. However, I would prefer to limit it to only similar and related claims because, if the claims are completely different, it is better that they go through mediation. But I take his point.
Representation at the ECT. Many Members talked about legal representation. The reason why we insist on no legal representation at ECT is because we think this will work to the disadvantage of the workers. Because if we allow legal representation, it is more likely that the employer will be able to afford legal representation as compared to the employee. But, more importantly, as I have mentioned, we want the ECT to be a very affordable, very expeditious way of resolving disputes. Any complex cases that require legal representation, they should go to the Civil Court rather than come to the ECT. We are not saying that this is not important; we are just saying that it is outside the scope of the ECT.
Several Members also asked about the representation at ECT. I just want to confirm again that for union members in the unionised companies, they may be represented by the unions at mediation and at the ECT hearings. Union members in a non-unionised company, who undergo the Tripartite Mediation Framework (TMF), can seek consent from the ECT for their tripartite mediation advisors to observe their ECT hearings. These will be prescribed in the subsidiary legislation, in black and white.
Mr Zainal asked whether the next-of-kin (NOK) can make the claim for some members. Generally speaking, claimants must make their claims in person. But in cases where the employee does not have the capacity to represent himself, his NOK may apply to the courts to be appointed as a deputy under the Mental Capacity Act. Once appointed as a deputy, the NOK may then submit a mediation request on behalf of the employee.
Some Members also expressed the concern on what if the worker is not able to express himself, not able to present his case fairly due to whatever constraint, then whether the judgment will be a fair one. Here, I want to assure the Members that the Tribunal Magistrates appointed to the ECT will be legally qualified and they will decide on each case, its merits and in accordance with the relevant legislation, case law and legal principles.
The ECT will adopt a judge-led approach. So, the judge will lead the Tribunal and may allow individuals with relevant skills and experience to act as assessors, as suggested by Mr Murali. The ECT may also summon any person to give evidence or produce relevant documents. Parties may appeal to the High Court against an ECT order on grounds of law and jurisdiction. In other words, all these measures are to ensure that there will be a fair outcome.
In terms of the processing of ECT cases, I would like assure Mr Patrick Tay that ECT and TADM will continue to prioritise the urgent cases, which is what we are doing in Labour Court today.
I agree with Mr Patrick Tay that the claim process should be simplified where possible. At the same time, Mr Zainal Sapari also asked about the ECT's operating hours and having some claim forms in the vernacular languages.
Mr Deputy Speaker, this ECT is part of the State Courts system. ECT will align its processes with that of the other State Court tribunals. MOM will work with the State Courts to customise the services of the ECT according to the needs of the workers.
Mr Louis Ng had some questions regarding ECT records and grounds of decisions. MOM and the State Courts will explore these matters in the drafting of the subsidiary legislation.
On the ECT fees, Mr Patrick Tay, Mr Louis Ng and some other Members touched on the affordability of ECT fees. I fully agree that the fees should be kept affordable. In fact, that is the whole purpose of the ECT. We will consider various suggestions, for example, to tier fees by claim amounts and so on. Mr Faisal Manap was concerned that the fees may be set too high and he hoped that it would be set below $160 or something like that. We will bear that in mind.
I would also like to assure Mr Zainal Sapari and Mr Faisal Manap that the ECT will be accessible to low-wage workers and we will waive the fees for deserving cases, which is in line with today's State Courts practice.
Enforcement of the ECT orders. Ms Thana asked how the ECT orders can be enforced. If the orders are not complied with, they can commence debt recovery by applying to the State Courts for a Writ of Seizure and Sales. I think Members are concerned about what if the workers do not know how to go about doing this, and whether it will be too costly for them. I am happy to share with Members that TADM will assist them. TADM will give them advice and assist them to go through that process.
Assoc Prof Daniel Goh referred to my reply to a PQ on 11 May 2015, mentioning that of those employers who did not comply with the Labour Court's orders, 80% of them turned out to be able to pay. Maybe the way I put it was not so clear. So, I wish to clarify. What I meant was that of all the employers who receive Labour Court orders, 80% were able to pay. Only 20% did not make the full payment. Of those 20% who were unable to make full payment, the majority of them were due to financial difficulties, in some cases, going out of business.
For those who wilfully disobeyed the Labour Court orders, they can be prosecuted under the Employment Act for salary offences. So we do have the mechanism to prosecute them. We have done so and will continue to do so.
To help the local vulnerable workers who are caught in situations where companies may not have assets to be seized or may have stopped operations and are unable to make the payment, Assoc Prof Daniel Goh, Louis Ng, Cheryl Chan, Gan Thiam Poh and members asked whether we can do something to help them. I am happy to say that MOM is in the process of establishing a short term relief fund to assist such workers, and this fund will be administered by TADM. More details will be disclosed later.
On public communication, I agree with Members ‒ Mr Patrick Tay and Mr Zainal that it is important to raise awareness about ECT and TADM, including the rules and processes. So, MOM certainly will work with tripartite partners and key stakeholders to do so.
I also agree with Mr Chua who highlighted that it is important for the employers, especially the SMEs, to enhance and raise their HR competencies so as to avoid disputes rather than to be faced with disputes. We will do our part as well to help to upgrade the HR capabilities amongst the SMEs.
Mr Murali asked what kind of claims will continue to come to the Commissioner for Labour under the Employment Act. With the setting up of the ECT, the Commissioner for Labour will continue to hear claims related to the transfer of employment to another company because of restructuring, and claims related to the recovery of salary not paid in legal tender. These will not be under the ECT. In addition, the Commissioner for Labour will continue to handle non-salary-related disputes, such as unfair dismissal.
Mr Murali asked why is it that employers should raise the issue of re-employment eligibility during mediation and not during the ECT hearing. I want to clarify that under the Retirement and Re-employment Act (RRA), re-employment eligibility is determined by the MOM. If the employees and the employers have disagreement over the re-employment eligibility, the employee should come to MOM and we will get it settled. Once it is determined that the employee is eligible for re-employment, if they cannot agree on the payment of the Employment Assistance Payment (EAP), that is where the ECT will come in to rule whether the payment is adequate and appropriate.
Assoc Prof Daniel Goh asked about the outcomes of public consultation conducted earlier this year. We did receive feedback, and many of the feedback were similar to the issues raised by the Members today. A summary of the feedback and the response will be made available online on the REACH platform following the debate in this House.
Mr Deputy Speaker, establishing the ECT is a big step forward, but is not the final step. It is just a good start. We are going to do much more.
For example, Mr Patrick Tay asked about reviewing our employment legislation. Over the years, we have progressively expanded our EA coverage for PMEs. We first extended salary protection under the EA to PMEs earning less than $2,500 because, prior to that, there was no coverage for PMEs. In 2008, we included PMEs earning less than $2,500 under our EA. This salary ceiling was raised to $4,500 in 2011. In 2014, we amended the EA to give PMEs some non-salary protection, such as sick leave benefits, unfair dismissal. We will continue to work with the tripartite partners to regularly review our employment legislation, including the EA salary ceiling as suggested by Mr Tay.
Mr Tay also asked about covering more types of disputes under the TMF. Today's Bill now allows the TMF to cover a broader range of disputes, including salary-related and non-salary related disputes, like re-employment. We will continue our discussions with the tripartite partners for the TMF to cover more non salary-related disputes, such as unfair dismissal. This is something we will do through tripartite consultation.
Mr Faisal Manap, Mr Dennis Tan, Ms K Thanaletchimi and Mr Gan Thiam Poh also asked whether the ECT could hear non salary-related disputes in future, including unfair dismissals, workplace injury claims, discrimination and so on. The tripartite partners have deliberated at length and we have decided and agreed that the ECT should start with resolving salary-related dispute claims in an affordable and expeditious manner now, before we consider to expand the scope of the ECT to hear non salary-related issues in future. So, not now, but in the future. The tripartite partners will continue to deliberate on this issue.
In conclusion, Mr Deputy Speaker, I want to come back to the point made by Assoc Prof Randolph Tan. It is a very important point. At the end of the day, what we really want to strive for is having good progressive HR practices at the workplaces so that disputes can be prevented. I share his views completely.
The ECT is a solution to resolving disputes. However, we must not forget that at the end of the day, avoidance of disputes is better than resolving disputes.
I also agree with Mr Thomas Chua's point about paying more attention in supporting the SMEs. We will be doing even more to help the SMEs to keep upgrading their HR capability. I share Mr Thomas Chua's concern that if the ECT mechanism is made too complicated, many SMEs may not be able to cope with it. That is the reason why we have set up the ECT as a first step to be as simple and direct as possible.
I believe that the establishment of the ECT and TADM is an important step forward in addressing salary-related claims for all workers and, hopefully, will create a more comprehensive dispute management landscape here and lay the foundation for us to continue to update and evolve the dispute resolution mechanism in Singapore. Mr Deputy Speaker, with that, I beg to move.
Assoc Prof Daniel Goh Pei Siong: I have a minor clarification for the Minister on the "80%, 20%" point. I am quoting the Minister from the Hansard: "At the same time, employers were also taken to the Labour Court to settle the payments to the workers. For that, last year (2014), we cleared about 1,630 cases. And of these cases, two-thirds of the workers were able to receive full payment. However, one-third of them, due to financial difficulties faced by the companies, received either partial payment or no payment. We investigated further into those employers who were not able to make full payment and we discovered that 80% of the employers were able to make full payment but 20% of them were unable to pay due to financial difficulties."
So, it seems that of the one-third that initially did not pay to the workers to settle the claims, 80% were found to be able to make the full payment because of MOM's investigation. That is my clarification. My questions are: Did MOM actively then enforce the order on this 80% and get them to make the full payment to the workers? Would MOM then continue to do so for the ECT?
Mr Lim Swee Say: Mr Deputy Speaker, I thank the Member for the clarification. I read the Hansard as well, and I think the way I worded it may have created this wrong impression. This is the reason why I thought it is important that I clarify it here. Basically, what I meant to say was that of all the companies, of all the employers who received the Labour Court order for payment, 80% actually were able to make payment. Only 20% did not make the full payment.
Of the 20% that did not make full payment, some of them did not have assets to seize, some of them had run into financial difficulties or they had closed down their businesses. For these, obviously, there is no recourse. For those who are actually able to make payment, but for whatever reason refuse to make payment, we prosecute them under the Employment Act because this is a salary offence. In other words, even with ECT, we still have the right to pursue employers for failing to make salary payments.
Ms K Thanaletchimi: Sir, I have just one clarification. Section 10 of the Bill seems to be silent on the contents of the record of the Tribunal and whether parties are entitled to a copy of the records. Will the decision of the ECT be made available to the parties in written form?
Mr Lim Swee Say: Mr Deputy Speaker, this will be in accordance with the State Courts procedures. For example, whether the issue of re-employment eligibility, was discussed in mediation, the information will be made available to the ECT. Likewise, the records of the ECT, as I had replied earlier to the suggestions made by Mr Louis Ng, we will work together with the State Courts to look into these proposals.
Assoc Prof Daniel Goh Pei Siong: The Minister said that MOM will continue to prosecute those who do not want to pay under the Employment Act. But would this cover the PMEs because the Employment Act does not cover the PMEs?
Mr Lim Swee Say: Mr Deputy Speaker, Sir, for those who are covered under the Employment Act, we can prosecute them under the Act. For those not covered under the Employment Act, the advantage of the ECT is that the order of the ECT is now enforceable by registering the settlement outcome with the District Court. That is a big plus.
By the way, for TMF, that is, likewise, the biggest improvement. Salary-related settlement agreements at TMF are now enforceable through registration with the District Courts.