Exclusion of Overtime Pay in Workfare Income Supplement Computation of Monthly Salary

17 Mr Liang Eng Hwa asked the Minister for Manpower whether the Ministry will exclude overtime pay in the computation of monthly salary to qualify for the Workfare Income Supplement as workers' overtime allowances are irregular and may disincentivise workers with gross monthly income near the $2,000 cut-off mark not to take up overtime work.

Mr Lim Swee Say: The Government had considered using basic pay, that is, excluding overtime pay and bonuses, in the computation of income for the purposes of the Workfare Income Supplement (WIS) Scheme, but decided not to pursue it because basic salary, overtime pay and bonuses are part of a worker's total income that will help support the worker and his or her family.

Given that WIS is intended to help low-wage workers by supplementing their income, it is fair to look at the total income in assessing the level of support provided through WIS. This will also not incentivise employers and workers to reduce basic pay and increase overtime which would not be in the workers' interest.