Mr Pritam Singh (Aljunied): Chairman, the underpayment of foreign workers and Pass holders is not just a travesty against foreign workers; it sabotages Singaporean workers by undercutting their wage competitiveness. Unscrupulous employers take advantage of the significantly imbalanced negotiating position of foreign workers and coerce them to return a portion of their salaries in cash. Foreign workers are usually in debt by way of agency fees owed back home or to middleman employment agents, many of whom are outside Singapore’s jurisdictional reach. The foreign workers in question would unsurprisingly be more concerned about their prospects for continued employment or employability in Singapore. In such a scenario, the disadvantages of reporting an errant employer to MOM can far outweigh the advantages.
The Minister for Manpower, arising from Parliamentary Questions filed by Workers’ Party Member of Parliament Mr Faisal Manap and Progress Singapore Party Non-Constituency Member of Parliament Leong Mun Wai, recently confirmed that about 190 employers were found underpaying their foreign employees every year between 2015 and 2019. That total corresponds to close to 1,000 employers over a five-year period. The total number of foreign workers who were underpaid was not disclosed, nor were any details of restitution made to these workers disclosed as well. Can the Minister make these details known?
The Minister also shared that the number of errant employers caught was the result of improved detection capabilities and education efforts to encourage foreign employees to report salary irregularities. Minister committed that the Ministry would continue to take strong surveillance and enforcement action.
Under the Employment of Foreign Manpower Act, it is an offence if employers do not pay their foreign employees their contractually stipulated salaries or inflate their foreign employees’ salaries with no intention of paying them the amount declared to MOM. Sir, I believe it is time to come down harder on errant employers who denied their foreign workers and Pass holders a fair wage and, in doing so, also lower the employment opportunities of Singaporeans who are qualified to do the same jobs.
Compared to the numbers from 2010 to 2014 where 60 errant employers each year were found to have illegally deducted the salaries of their foreign workers, the numbers are clearly on the increase. One direct way to resolve this matter would be to raise the deterrent effect of the enforcement regime by increasing the penalties for underpayment of foreign workers and Pass holders under the Employment of Foreign Manpower Act.
A second approach could be to tweak the law to require an errant employer, in addition to criminal penalties, to pay the foreign worker a penalty amounting to six months of the foreign workers’ wage for each instance of intentional underpayment to circumvent MOM regulations. This amount would represent a punitive element that seeks to activate a behavioural effect to nudge foreign workers to proactively report employers who do not pay their declared wages, as required by MOM.
Ministry of Manpower
2 March 2021