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National Wages Council in talks for possible pay rise for low wage workers

Next week, the National Wages Council (NWC) is expected to announce recommended pay hikes for low wage workers. If these recommendations are accepted by the Government, they will come into effect by 1 July this year.

The NWC comprises of 18 members, including chairman Peter Seah, six NTUC unionists, six representatives from employer groups, and five public-sector officials. On 25 May labour chief Chan Chun Sing declined to reveal more on the recommendations before their official announcement next week.

In 2012, a S$50 pay rise was given to workers earning a basic monthly salary of up to S$1,000. This was in response to a push by the National Trades Union Congress (NTUC), which has ben lobbying for the raising of pay for low wage workers since that year.

The pay rise in 2012 was also supported by the NWC, and the Government accepted the recommendation.

Following 2012, recommended pay for low wage workers has been continuously rising, with the Government approving a minimum built-in pay increase to S$60 in 2013, a S$60 increase for low wage workers’ pay in 2014 and most recently, an increase in the salary bar to S$1,100 last year.

Discussions between NWC members begin every year in March and carry on until May. This year, it has been reported that unionists have continued to lobby for hikes that are quantitative, similar to those in the previous three years.

Nevertheless, it should be noted that even if the recommendations by the NWC are accepted by the government and are implemented in July, they are simply guidelines and are not binding for any employer.

Manpower Minister Lim Swee Say observed in Parliament in January that only six out of ten companies in the private sector took up the recommendation and implemented the wage hike for their low wage workers in 2014.

Additionally, managing director of human resource firm People Worldwide Consulting Mr David Leong noted that wage hikes are tough for employers in an economy that is slowing down, and that it would not be advisable to expect a wage hike to be accepted by the Government every year from here on out.

Nevertheless, he acknowledged that in previous years, pay rises for low wage workers were significant in improving the lives of such workers.