As the impact of the COVID-19 pandemic worsens, the more than 8,000 multinational firms in Singapore may receive directives pertaining to retrenchments from their global headquarters.
However, Alexander Melchers, who is a council member of Singaporean-German Chamber of Industry and Commerce (SGC), advised that these Singapore company branches could notify headquarters of other cost-minimising measures that can be implemented to preserve its workforce in the country, made possible by the collaboration between the Government, unions, and company.
“It is crucial for the management here to communicate to their headquarters that in Singapore, we take a very different and tripartite approach. In fact, many in Europe and America look to Singapore and even talk about ‘Singapore-ising’ their approach… These circumstances call for employers to act quickly, but in a responsible and humanitarian way to sustain our businesses,” said Mr Melchers at a media conference on Monday (30 March).
According to Peter Seah, who is the Chairman of the National Wages Council (NWC), DBS, and Singapore Airlines, the core principle of the tripartite movement is that all parties should always act responsibly.
When asked about whether some firms may take advantage of the cost-reducing guidelines set by NWC even if they are not impacted by COVID-19, Mr Seah replied, “We certainly would not condone any parties acting irresponsibly and weakening therefore this tripartite partnership and friendship.”
Workers are discerning and they know well the performance of the company, as remarked by Mary Liew, who is the President of the National Trades Union Congress.
Ms Liew added, “It is important that during this time, employers step forward and also show their appreciation and work closely together with workers and also reward them fairly and accordingly as well… When the economy turns around, they will need the workers as well to continue on with their journey.”
She also advised workers to attend training and to accept new job roles and flexible work schedules, as well as accepting lower salary if that will get the firm to retain them.
In 2003, amid worries about Singapore’s cost competitiveness, the contribution rates of the Central Provident Fund (CPF) was slashed in order to cut wage costs. The NWC had considered whether to suggest such a move this time also.
According to Aubeck Kam, who is the Permanent Secretary for Manpower, the Government felt that a cut to the rate is not needed because the employer CPF contribution rates of up to 17 per cent were much less than the 25 per cent wage subsidy in the enhanced Jobs Support Scheme announced in the past week.
The President of the Singapore National Employers Federation, Robert Yap concurred that the Resilience Budget “helped to solve many, many issues” whereas CPF savings aid employees to pay for their mortgage loans, Ms Liew added.