WHY ONLY LOW WAGE WORKERS ARE REHIRED BEYOND 65 YR OLD RETIREMENT AGE?

Wage subsidy for older workers extended

I refer to the article “Wage subsidy for older workers to be extended” (Straits Times, Dec 2).

It states that “Under the scheme, employers can get up to 3 per cent more wage credit if they rehire Singaporeans who are aged 65 and above, and who earn up to $4,000 a month.

$22m wage credit to 110,000 workers

Mr Lim said the Government has paid out over $22 million to more than 49,000 employers for rehiring about 110,000 of these older workers in the first half of this year.”

Mostly low-income workers rehired?

Does this mean that the average wage credit of the workers rehired was only about $33 a month ($22 million divided by 110,000 divided by 6 months)?

So, does it also mean that the average salary of the workers rehired was only about $1,111 a month (3% of $1,111 is about $33)?

Why is it that apparently most of the workers rehired are low-income workers, since the wage credit is up to $4,000 monthly salary?

In other words, it may seem that most middle income workers (up to $4,000) may not be getting rehired.

Re-employment Act issues?

The above statistics may highlight the weakness of the Re-employment Act.

For example, the employer can arbitrarily choose not to offer re-employment to the employee if the employee is assessed by his employer to not have satisfactory work performance or not medically fit to continue working.

Also, an employer can offer any terms – huge pay cut, longer work hours, heavier work load, etc – and if the employee does not accept – the employer would have fulfilled their obligations under the legislation.

If the employer does not want even to offer any terms – its just a one-time payment of $4,500 to $10,000.

And of course the above legislation only applies to re-employment at age 62, and not to rehiring at age 65

Only $10,000 maximum compensation?

In this connection, according to the Ministry of Manpower’s (MOM) web site – “Assisting Eligible Employees whom Employers are Unable to Re-employ The Tripartite Guidelines recommend that EAP should be a last resort for employers who cannot offer re-employment despite their best efforts. The EAP amount could be 3 months of salary.

A minimum amount of $4,500 and a maximum amount of $10,000 could be considered.” – So, does it mean that under the Re-employment Act – the maximum compensation for not offering re-employment at age 62, may only be about $10,000?

Protecting workers?

Isn’t the legislation arguably, rather weak in protecting workers? Do we have possibly the weakest re-employment legislation in the world, from the perspective of workers’ rights?

Leong Sze Hian

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