Source : en.wikipedia.org

MOM advisory to employers of Indonesian FDW on new Performance Bond requirement

Ministry of Manpower (MOM) has advised that Employment Agencies (EAs) in Singapore have been notified by the Embassy of the Republic of Indonesia in Singapore that it would impose a new $6,000 Performance Bond requirement on employers who hire Indonesian foreign domestic workers (FDWs).

MOM stressed that this is not a requirement of the Singapore Government, which is separate from the $5,000 Security Bond which MOM requires all employers to purchase for every FDW hired.

MOM stated that it understands that, if notified by the EA, an employer of a new FDW from Indonesia will be asked to purchase a Performance Bond guarantee from an insurer approved by the Embassy, and sign a standard employment contract issued by the Embassy. Employers who renew passports of their current FDWs or process documents at the Indonesian Embassy may also be asked to do likewise.

“An employer could be liable to pay the insurer a sum of up to $6,000 if the Embassy forfeits the Performance Bond. The specific conditions under which the Embassy may forfeit the Performance Bond are not clear. There also appears to be a lack of mediation and dispute resolution process available to employers before the Performance Bond is forfeited,” it noted.

MOM stressed that it has made it clear to the Indonesian Embassy and the Indonesian Ministry of Manpower that the Performance Bond requirement is unnecessary given Singapore’s comprehensive regulatory framework to protect all FDWs.

It noted that EAs are obliged to provide explanation and obtain written acknowledgement from affected employers of FDWs indicating that they understand the implications before purchasing the Performance Bond guarantee or signing the Embassy’s standard employment contract.

“We will also be sending an advisory to all existing employers of Indonesian FDWs to urge them to read and understand the terms and conditions, before purchasing the Performance Bond guarantee or signing the standard employment contract. If they have questions , they should seek clarification directly from the Indonesian Embassy,” MOM added.

Indonesia’s decision to implement their own performance bond comes mainly due to the 1,579 migrant worker cases that were handled in 2017, which included complaints of sexual, physical and emotional abuse.

Indonesia’s performance bond operates very similarly to the current MOM and Filipino performance bonds. For instance, you can risk breaching the bond if you fail to give your worker 4 days off per month, don’t provide 3 meals a day, refuse to cover her medical fees, pay her below minimum wage and subject her to life-threatening work.