MP proposes removing exemption of company transferees from Jobs Bank requirement but CECA says no

MP proposes removing exemption of company transferees from Jobs Bank requirement but CECA says no

National Trades Union Congress assistant secretary-general and PAP MP Patrick Tay told the media on Thursday (6 Aug) that “it is ever more critical for us to ensure that Singaporeans are considered fairly, especially in the current employment climate”. His comment came on the heels of last month general election when the PAP lost 2 GRCs to the oppositions.

In addition, the Manpower Ministry (MOM) also announced that 47 more employers were recently added to the FCF watchlist for suspected discriminatory hiring practices against Singaporeans. Of the 47, 30 are in the financial and professional services found to have a high concentration of PMETs from single nationalities.

But a member of the public, Hong Chee Meng, was not impressed with MOM’s actions. He wrote to ST Forum arguing that MOM shouldn’t have issued work passes to foreigners in those companies in the first place.

“One would expect that background checks on matters such as the existing workforce composition in a company would have been done before more work passes are granted,” Mr Hong said.

“It would not be unreasonable for MOM to reject work pass applications from a company if the foreign proportion of its workforce has hit, say, 25 per cent of the total. This level should have sounded alarm bells.”

Instead, MOM continued to issue work passes to the foreigners in those said companies until their foreign proportion reached alarming levels.

Mr Hong added, “Placing companies with potentially discriminatory hiring practices on a watchlist appears to be an ‘after the fact’ action, as the foreign workers concerned will already be on board in the companies, limiting the scope of corrective actions that can be implemented.”

Removing exemption for intra-corporate transferees

While speaking to the media, PAP MP Tay also proposed that the government removes the exemption for intra-corporate transferees (ICTs) from FCF. Currently, a job is exempted from the FCF advertising requirement if it will be filled by an ICT. The FCF advertising requirement mandates that companies must advertise positions for Singaporeans on Jobs Bank before they can apply for EP to hire foreigners.

To be exempted, the foreign candidate has to meet the definition of ICTs under the World Trade Organisation’s (WTO) General Agreement on Trade in Services (GATS). WTO GATS defines an ICT as:

  • Manager, who has authority over day-to-day operations and, to hire and fire personnel;
  • Executive, who receives only general supervision or direction from management; or
  • Specialist, who possesses knowledge at an advanced level of expertise.

Additionally, under WTO GATS, an ICT:

  • Must have worked for the company outside Singapore for a minimum of 1 year
  • Are limited to a 3-year term but can be extended up to a maximum total of 5 years.

Singapore signs a more generous CECA with India

However, it’s almost impossible for the Singapore government to remove such exemption at least for ICTs coming from India. This is because Singapore has already signed the Comprehensive Economic Cooperation Agreement (CECA) with India in 2005, which supersedes some of the terms in WTO GATS.

In fact, it was none other than DPM Heng Swee Keat, who led the Singapore team in negotiating CECA with India back when he was the permanent secretary of MTI more than 15 years ago (‘ST says number of local IT grads set to grow while CECA continues to import IT workers from India‘).

Under CECA, it allows for “movement of natural persons” between India and Singapore. DPM Heng even negotiated more generous terms with India for ICTs:

  • Must have worked for the company for a minimum of 6 months with at least 1 year of industry experience
  • ICTs will be permitted entry and can work for up to 2 years. This can be extended to a total term of not more than 8 years.

There is also no quota requirement imposed on Indian ICTs, which means an Indian company can hire a whole “village” of staff in India and transfer them to Singapore 6 months later lock, stock and barrel, assuming they all have at least 1 year of industry experience.

Furthermore, under Article 9.3 of CECA, all the ICTs are to be exempted from any “labour market testing” or “economic needs testing”. That means, economic needs testing like Singapore’s FCF advertising requirement cannot be applied to them.

To top it all, Article 9.6 of CECA even allows the ICTs to bring in their spouses or dependents to work in Singapore too.

If the Singapore government were to rescind CECA, it would be catastrophic to the Singapore investments thrown into India especially those billions from GLCs, Temasek and GIC.


Notify of
Oldest Most Voted
Inline Feedbacks
View all comments