Employers should not bear the cost of COVID-19 swab tests for migrant workers in the construction sector, said the President of the Singapore Contractors Association in a letter to Deputy Prime Minister and Minister of Finance Heng Swee Keat on 23 May.
In the letter which TOC saw, Mr Ng Yek Meng stated that the industry was “caught by surprise” by the Government’s announcement on 15 May that employers will have to bear the cost of regularly testing construction workers as they head back to work.
The letter noted, “With the current cost of about S$200 per test, this will translate into S$120 million per month for the population of 300,000 foreign construction workers.”
Mr Ng explained that the cost of COVID-19 testing is not priced into the contractors’ tenders, meaning that this will add a massive burden to contractors, many of whom are small and medium enterprises (SMEs) “already under deep financial stress”.
“We are concerned that many companies may collapse and that it will affect the livelihood of about 100,000 local employees in the construction industry,” he remarked
Mr Ng added, “In addition, the construction capabilities, experience and skills built over the past decades be lost. The local SMEs play a key role in supporting the bigger players, including MNCs. The gap is not easily filled by bigger players.”
He went on to say that as the COVID-19 outbreak is a national health concern, employers in the construction industry should not bear the testing costs. He appealed to the Government to help construction companies stay afloat.
Construction costs will rise and will be borne by “all of us”
Two weeks ago on 15 May, National Development Minister Lawrence Wong said in a press conference that construction costs in the country will go up as authorities require that all workers in the sector be tested regularly, adding that the cost will be borne by “all of us”.
“So I have no doubt, and as with all regulatory requirements, the principle must be that the company must bear the cost,” noted Mr Wong, who co-chairs the country’s Multi Ministry Task Force on COVID-19.
“So I have no doubt that it will mean construction costs in Singapore will be higher because of these regulatory requirements. And all of us have to be prepared to pay this higher cost, because we want construction work to be done safely in Singapore from henceforth,” he added.
When asked if the Government will share the cost of testing these workers, Mr Wong said, “This will be a new regulatory requirement on top of all the other safe distancing measures that we have put in place, that we are talking about, that contractors will now have to uphold.”
About 90% of workers still not allowed to work
It was earlier announced on the same day that the construction workforce will be tested every two weeks as the industry gradually reopens. Building and Construction Authority (BCA) chief executive Hugh Lim explained that only about five per cent of the construction workforce is currently working on “very small number of critical infrastructure projects ad those that have to continue for safety reasons”.
Another five per cent of workers is expected to get back to work in June, stated Mr Lim, adding that these would be for projects that are time sensitive like the Deep Tunnel Sewerage System (DTSS) tunnel projects and those that cannot be left idle for too long due to safety reasons.
This means that by June, about 90 per cent of migrant workers still would not be allowed to resume work. However, employers would still have to pay S$400 a month per employee to conduct regular COVID-19 tests on top of the cost of dormitories* and other expenses they are already bearing for migrant workers.
On Tuesday (26 May), Deputy Prime Minister Heng Swee Keat said in Parliament that foreign worker levies will be waived for up to two more months while levy rebates will be extended for the same period after the circuit breaker ends on 1 June, specifically for businesses that are not allowed to resume on-site operations immediately.
In his speech, Mr Heng explained that the waiver will be 100 per cent in June and 50 per cent in July, while the rebate will be S$750 in June and S$375 in July.
However, while levies and levy rebates have been extended for firms, they still have to continue paying wages for their employees who are not yet allowed to resume work.
An employer whom TOC spoke to, shared that few – if any – employers would dare to let go their existing workers even if there is no work to be done as it might be near impossible to get in new foreign workers amidst this pandemic.
Earlier on 12 May, National Development Minister Lawrence Wong said that about 3,000 migrant workers are being tested per day with over 32,000 already tested. Mr Wong noted that the Government wants to ensure that all migrant workers are free of COVID-19 before being allowed to go back to work.
To date, 30,093 migrant workers living in dormitories have been tested positive for COVID-19 which makes up about 93 per cent of all cases in the country.
* Those in isolated dorms have the cost paid by Ministry of Manpower