More lower-wage workers to benefit from multi-layered Progressive Wages

A strong tripartite framework and a targeted sectoral approach have enabled Progressive Wages to effectively uplift all lower-wage workers in Singapore

Since Workfare and the Progressive Wage Model were introduced in 2007 and 2012 respectively, they have been among Singapore’s most effective tools in uplifting the wages and lives of lower-wage workers.

Over the past decade, the multi-layered support has helped lower-wage workers to enjoy higher income growth than the average worker, especially in the last five years.

Thus, the latest announcement by Prime Minister Lee Hsien Loong at the National Day Rally 2021 to expand the multilayered Progressive Wages framework was welcomed by many. Among the 18 recommendations is that Progressive Wages will be extended from the cleaning, security and landscape sectors to retail, food services and waste management. It will also be expanded to administrators and drivers, across industries.

Mr Zaqy Mohamad, who chairs a Tripartite Workgroup on Lower-Wage Workers which was formed last year, said: “As a society, we take care of every worker and leave no one behind, especially our lower-wage workers. Our workers are not just the backbone of the economy. Their livelihoods provide for their families, who are the backbone of our society,” said the Senior Minister of State in the Ministry of Manpower and Defence.

Success through tripartism

The strength of Progressive Wages lies in the strong tripartite relationship between the people, Government and the unions. The three parties work together to move forward in agreement on wage structures and progression, as well as relevant training requirements.

“Collectively, achieving progress for lower-wage workers can be a win-win prospect, rather than a zero-sum game,” he said.

Instead of a one-size-fits-all approach, Progressive Wages allows for a different rate of progress between sectors. This was demonstrated during the Covid-19 pandemic.

“A blunt minimum wage may not have been able to achieve consensus or wage growth, especially in tourism, aviation, hospitality and other sectors that were severely impacted by Covid-19,” he said.

“Our targeted approach has enabled the tripartite movement to advance Progressive Wages at a pace based on how the respective sectors perform in the market.”

Uplifting wages and skills in a sustainable manner

The multi-layered approach of Progressive Wages includes the Workfare Income Supplement (Workfare) scheme under which the Government tops up the salaries of lower-wage workers in cash and CPF contributions.

In addition, the Local Qualifying Salary (LQS) will be expanded. Companies will have to pay all their local employees this LQS if they want to hire any foreign employees. The PW Mark will be introduced to enable society to support firms which pay their workers Progressive Wages.

Going forward, Progressive Wages will further improve the salaries and work conditions for 283,000 or up to 93 per cent of our lower-wage workers.

He said: “The PAP Government commits itself to ensuring that no one is left behind in Singapore. Alongside supporting schemes for housing, education, CPF and healthcare which are important to level up society, our focus on enhancing Workfare, skills development to career ladders will ensure that our workers will progress and have their share of benefits from our economy.

“If our moves are successful, it can set the bar on how Singapore uplifts lowerwage workers sustainably and create a win-win condition for the worker and the employer so that Singapore is united and progresses as one.”

Source of feature image: Ministry of Manpower