Changes in foreign worker law: who benefits? Part 1

The Ministry of Manpower (MOM) is groaning under the weight of foreign manpower-related cases. There are all sorts of job scams going on, and thousands of short-payment and work injury claims. In its latest attempt to address the problem, the ministry has proposed, in a consultation paper, to amend the Employment of Foreign Manpower Act (EFMA), but the changes seem to me to be more concerned with punishing those who flout the ministry’s rules than those who abuse workers.

It doesn’t take much exaggeration for me to reduce this to one pithy statement: You can abuse your workers as much as you like, just don’t disrespect the government.

Of course, as a consultation paper, nothing is yet set in stone. Hopefully, it will be improved consequent to feedback.

In Part 1, I will sketch out what I discern as the primary motivation behind the proposals. But my feeling is that this motivation largely fails to take into account the two most common problems facing low-wage migrant workers – salary non-payment and abandonment after injury. How the proposals address, or not address the issue of salary non-payment will be discussed in Part 2, while Part 3 will focus on injured workers. How will these groups benefit from these rule changes?  What improvements in rules are needed to include their interests?

The changes in brief

‘Foreign manpower’ is a broad spectrum. Constituting about a third of the total labour force and numbering about 1.2 million (MOM’s 2011 data), the term encompasses high-flying professionals and corporate leaders as well as domestic maids, road sweepers and construction labourers. The spread is reflected in the fact that government-issued work passes are of three broad grades: Employment Passes,  S-Passes and Work Permits, in descending order of qualification criteria and pay scales.

It is important to bear this range in mind when looking at the ministry’s consultation paper (the main paper is here; appendices here). Some elements of it may apply more to one class than others.

Basically, the proposals do three things:

  1. Create several new offences that will be prosecuted in court
  2. Create a class of administrative contraventions that will attract administrative penalties, bypassing the judicial system
  3. Create a set of presumptions that the accused persons have to rebut

Instinctively, I am wary of (2) and (3), because resorting to them can often be for administrative convenience, and thus open to abuse. But this is something only operating experience will reveal, and for now it is too early to say how these provisions will work out.

More importantly, why are some offences to be prosecuted in court and others to be dealt administratively? The consultation paper’s stated principle is that if it is a regulatory breach that does not harm or abuse the worker, it would attract administrative sanction. Examples include (a) “providing inaccurate information to the Controller of Work Passes” and “failure to inform Controller of change of address”. Otherwise, prosecution in court will follow, e.g. for such offences as (a) “Employers’ receipt of payment in consideration of employment” and (b) “Illegal labour importation”.  This may sound quite proportionate, but that merely assumes that prosecution in court is more certain and harsher than administrative penalties. I have my doubts.

Firstly, going by the penalties alone, it doesn’t appear to be the case. For administrative breaches, the proposed maximum penalty is $20,000, not a lot different from the maximum fines for criminal offences. That said, some criminal offences will also attract jail time, e.g. forged educational certificates.

However, and secondly, the ministry’s record of moving to prosecution is so poor that quite often employers get away with harming and abusing their workers. Unless this changes – and there is no evidence that the ministry is doing anything about their shameful record – the net effect will be that flouting administrative rules will get more certainty of punishment than cheating, underpaying or abandoning workers.

Hence, not only is there a need to improve the proposals, there is a need to be more conscientious about prosecuting errant employers. All the laws in the world won’t be any use if there is no political will or administrative effort to prosecute.  This is a point I will come back to further on.

Chief motivation for new rules

Reading the consultation paper, one gets the sense that the chief motivation for enacting new rules is a concern that employers are going to find ways to circumvent the gradual tightening of work passes. This tightening is in response to a massive outcry against the flood of foreign workers, especially skilled ones who compete directly with Singaporeans for middle-level jobs. These would be mostly in the S-Pass (minimum salary $2,000 a month) and Employment Pass (minimum salary 3,000 a month) categories. At the same time, there is a move to tighten the availability of low-skilled labour (Work Permits) as well because there is a need to use labour more efficiently.

Numbers in the latter category are controlled by quota. Numbers of S-Pass and Employment Pass holders are indirectly controlled by setting minimum educational and pay standards, but there is no quota.

The consultation paper hints at several ways that employers use to circumvent the increasingly stricter rules:

When an employer does not have the needed  quota for Work Permit low-skilled workers, there is a temptation to bring in workers on S-Passes, by

  • Tendering false educational qualifications;
  • Over-declaring salaries (but actually paying less than the minimum $2,000).

Alternatively, an employer can claim to employ more locals than he actually does, so that the allowed quota of foreign Work Permits is raised.

When an employer finds the rising government levies too costly, he may be tempted to

  • Claw back the levy costs from employees by various deductions;
  • Make employees pay for their jobs upfront, seldom directly, more often indirectly through employment agents giving a cut of agents’ fees to employers.

Meanwhile, job scams continue, where employers bring in workers based on their Work Permit quotas, even when they really do not have work for them. Why would they do that? Because the practice of making workers pay for their jobs is so prevalent that the handsome profit comes from the import of workers, not from any work itself.

The real distress

The tweaks to the law as laid out in the initial proposals are well and good, and cracking down on job scams will make a huge difference to those migrant workers who are currently being cheated. However, there is little in the consultation paper that addresses the chief ways in which errant employers harm and abuse workers, which produces victims that far outnumber that produced by scams. From my experience volunteering in this field, these chief ways are:

  • Not paying wages on time, sometimes delayed for months;
  • Under-calculating due wages;
  • Making employees work excessive overtime – which leaves them so tired, industrial accidents become much more likely;
  • Refusing to pay for needed medical care;
  • Terminating workers as soon as they are injured, then refusing to pay for medical care or provide for accommodation and “upkeep”.

The first three are already criminal offences and the other two are administrative breaches under the existing conditions of the Work Permit, but the fact that Transient Workers Count Too (the charity I volunteer with) sees thousands of such cases, tells us the system just isn’t working. Errant employers go scot-free and workers continue to be abused and abandoned in large numbers.

Adding new rules and laws will do little good when existing laws and regulations are not being enforced.

7 Responses to “Changes in foreign worker law: who benefits? Part 1”

  1. 1 Chanel 15 May 2012 at 16:34

    It is unsurprising that our foreign workers’ laws are laxed and there is a sore lack of political will to prosecute. Many companies and even industries in Singapore are kept on life-support via the virtually unlimited supply of cheap foreign labour. Making this source of labour more expensive would kill these companies or industries (that should have NOT be here in the first place).

    Thsi again backs your previously mentioned point that the PAP government have run out of ideas to move this country ahead.

  2. 3 ape@kinjioleaf 16 May 2012 at 09:17

    Someone I know who is an employer told me that it is certainly more expensive to hire foreigners due to levy, insurance, accommodation, etc. He stopped short of saying how some others managed to survive with some many foreigners under their ‘payroll’. Your experience in TWC2 have revealed the ugly truth.
    Although my friend is short of local staff, the sector he’s working in is still not as bad as construction industries where many are forced to take risks by breaking labour laws.
    The worst lot are those who exploited foreign labour by making them pay for their job! Imagine you pay your boss for working for him?!?!

  3. 4 georgia tong 16 May 2012 at 12:17

    Thanks for speaking up for the these folks. Great analysis.

  4. 5 TCL 16 May 2012 at 19:48

    Hi Alex, you mention above that there are no quotas for S-pass but by higher pay. I believe that’s not true, there are quotas for S-Pass. Only the EPs have no quota.

  5. 6 周文伟 17 May 2012 at 13:40

    All it takes is a disgruntled employee from MOM and a Human Rights activist to go the Human Rights Council to report on the SG Govt…

  6. 7 Fedup 30 May 2012 at 12:32

    As an employer, I’m faced with a problem. It is highly likely the new employee I want to bring on will have his SPass application rejected because his current employer is falsely declaring his salary as $3,200 to get an EP (no quota required). When I now apply for him an SPass at $2,300, the application will probably be bounced due to ‘inconsistent information’, as I am not prepared to put down $3,200 as his last drawn salary when I know it is only $1,500. Also, I may experience a backlash from his current employer if they are investigated for falsely declaring his salary. It’s a bad situation if you are honest, and pay the foreign workers a proper salary, and you do not want to perpetuate the lies.

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