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Friday, September 30, 2022
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159,000 LOW WAGE WORKERS WILL EARN AT LEAST $1.4K/MTH FROM 1 SEPT ONWARDS

The Ministry of Manpower said in a press release that all full time local workers that are hired by companies that employ foreign workers, must be paid at least $1,400 per month, under a new local qualifying salary requirement that takes effect from today (1 September).

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Ministry of Manpower’s statement

1.     From 1 September 2022, 197,000 full-time lower-wage workers will benefit from new Progressive Wage moves. This includes the new Local Qualifying Salary (LQS) requirement, and the introduction of the Progressive Wage Model (PWM) for retail workers, as well as for in-house cleaners, security officers and landscape workers. Including workers in the cleaning, security, landscape, and lift & escalator sectors, a total of 221,000 full-time lower-wage workers will benefit from these Progressive Wage moves.

2.       This milestone is part of the broader set of Progressive Wage moves announced by the Tripartite Workgroup on Lower-Wage Workers last year.  

New Progressive Wage Moves from 1 September 2022

3.      Firms that employ foreign workers must pay all their full-time local workers at least the LQS of $1,400. A total of 159,000 full-time lower-wage workers who are not in PWM sectors will benefit from this new LQS requirement, and be assured that their wages will not fall below $1,400. Part-time local workers will also benefit from this new LQS requirement, as they will need to be paid at least $9 in gross wages per hour.  

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4.      The Retail PWM will be implemented to raise wages, spur training, and improve the productivity of full-time lower-wage retail workers. About 19,000 full-time retail workers will benefit, with the entry-level PWM wage growing 18% over a three-year period.

5.     The PWM for Cleaning, Security and Landscape sectors will be extended to encompass in-house workers. Currently, the PWMs for these sectors only apply to outsourced workers. The extension of these PWMs to cover in-house workers will mean thatworkers who undertake the same job roles as outsourced workers, such as those employed in-house by hotels, facility management firms, food services firms and other businesses, must be paid at least the PWM wage corresponding to their respective job roles. This move will benefit about 19,000 full-time lower-wage workers.

Progressive Wage requirements for employers

6.       Employers are required to assess if their workers are performing a job role covered by a PWM by referring to the PWM job descriptions on MOM’s website. They should update and submit their workers’ PWM job roles, if any, through MOM’s Occupational Employment Dataset (OED) portal.

7.       During the first six months, from September 2022 to February 2023, tripartite partners will focus on educating employers on the various Progressive Wage requirements. Employers will be given time to adjust and comply. Employers who do not comply with the requirements during this transitional period will not face enforcement action.

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8.      To support employers as they adjust to the Progressive Wage requirements, the Government is co-funding the wage increases given to lower-wage workers through the Progressive Wage Credit Scheme. The PWCS will run for five years from 2022 to 2026. The Government’s co-funding support for 2022 wage increases was recently enhanced from 50% to 75% for wages up to $2,500, and from 30% to 45% for wages above $2,500 up to $3,000. Employers are urged to use this period of support from the Government to accelerate firm-level productivity improvements, so that the wage increases remain sustainable for employers in the long run.

Continued support for lower-wage workers

9.       To foster a more inclusive society and ensure no worker is left behind, the Government will continue to build on tripartite efforts to uplift lower-wage workers. The Progressive Wage Mark, which recognises eligible firms that pay Progressive Wages, will be launched by end 2022. More lower-wage workers will also be able to benefit from the Food Services PWM and Occupational Progressive Wage which will be implemented from March 2023. We encourage all employers to continue supporting their lower-wage workers to upskill and upgrade.

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