Legal Protection for Casual Workers

9 Ms Anthea Ong asked the Minister for Manpower whether the Ministry can conduct an in-depth study on legal protection for casual workers in other jurisdictions with the view of developing a new framework on the rights and benefits of casual workers given the rise in number of such workers in recent years.

The Minister of State for Manpower (Mr Zaqy Mohamad) (for the Minister for Manpower): Mr Speaker, casual work employees, whose working days or hours are not fixed, make up a small and declining share of the workforce. They constituted 3.4% of resident employees in 2018, down from 5.1% in 2009.

All employees, including casual work employees, are covered by Singapore’s various employment-related legislation such as the Employment Act and Central Provident Fund (CPF) Act. Therefore, like regular employees, casual work employees are entitled to timely payment of salary, CPF and protection against wrongful dismissal. They are also entitled to paid annual and sick leave if they have been employed for at least three months.

Other jurisdictions might have seen an increase in the number of self-employed persons (SEPs) engaging in casual work. In Singapore, we cannot equate SEPs with casual workers. For example, taxi drivers are self-employed but work regular shifts. Nonetheless, the proportion of SEPs who did self-employed work as their main job has remained stable at 8% to 10% of our resident workforce over the past decade. In fact, there was a drop in the number of SEPs last year, due in part to the tighter job market. Our surveys show that many SEPs choose to be self-employed for greater flexibility and autonomy.

In 2017, MOM convened a Tripartite Workgroup on SEPs. The workgroup consulted extensively with SEPs and other stakeholders such as SEP associations and service-buyers, and considered practices in other jurisdictions as well. Its recommendations are being systematically implemented.

First, the Tripartite Alliance for Dispute Management (TADM) launched its voluntary mediation services last year to assist SEPs in resolving disputes. The tripartite partners are also encouraging adoption of the Tripartite Standard on Contracting with SEPs and the key terms of engagement form template to minimise disputes. Second, we made available prolonged medical leave insurance products for SEPs to enhance their protection. Third, we are working with tripartite partners and SEP associations to ensure that SEPs have access to both technical and non-technical skills training. Lastly, we will be introducing a "Contribute-As-You-Earn" model to make it easier for SEPs to save for their healthcare needs. The Government, as a service-buyer, will take the lead to pilot this savings model next year.

For those seeking alternatives to casual work or self-employment, there is a wide range of support under the Government’s Adapt and Grow initiative. They can approach career centres run by Workforce Singapore and NTUC's Employment and Employability Institute (e2i) for assistance.

Ms Anthea Ong (Nominated Member): I thank the Minister of State for the response. I understand that a labour taskforce actually found that there is a third category of workers called the dependent workers. This would be workers who the Ministry cannot correctly categorise as either employees or self-employed persons. Examples of such dependent workers are typically the ones who actually choose to sell their services only to one company, the likes of Grab drivers and Deliveroo deliveryman. How are we supporting this group of dependent workers?

Mr Zaqy Mohamad: We are aware of some jurisdictions that introduced a separate category of workers and some limited employment protection. But we assessed that doing so, could lead employers to re-classify existing employees under this separate category, resulting in reduced protection. So, to a certain sense, one of the major issues that we have seen in countries such as UK and Italy where they have created a separate category, is that you find employees being classified there or you find mis-classification to try to game the system by providing them less benefits.

To some extent, there are two problems that we found. One, we found that in mis-classification, employees received weaker protection; at the same time, businesses also got smarter, they then change the contracting models to fully or partially avoid obligations. So, in Singapore for example, if you are classified as SEP, employers do not pay for CPF, for example, so you will have to fork out yourself. So, in a certain sense, the terms are very different and they are not covered against term. So, I think we will keep to the current model but where we will do more, are schemes in which, for example, for low-wage workers, we have got Workfare to support them and other forms of employability-type schemes such as training and insurance so that we can support them better.

Mr Patrick Tay Teck Guan (West Coast): I think I have personally come across casual workers who are sometimes wrongly classified as own account workers, self-employed, freelance, independent contractors, contract-for-service. These terms are used interchangeably. So, can we do more and can MOM have a more robust approach to errant employers as well as a better outreach to such casual workers?

Mr Zaqy Mohamad: I thank the Member for his observations. In fact, that was what I was mentioning just now, if we create new segments of workers, then all the more you will find employers or some industries try to game the system.

In the last three years, MOM and CPF Board received a total of 308 cases of suspected mis-classification. In a 160 cases, workers were assessed to be mis-classified as SEPs. Each case that MOM and CPF Board investigate, could involve more than one worker. On average, about 100 workers a year were found to be mis-classified. In all, but two of these mis-classification cases, employers made good their obligations when informed of the mis-classification, and paid back the affected employees what they were due including overtime pay and CPF contribution. Those are the protection they get as employees.

Penalties including warning and late payment interest charges were meted out to the companies. Two companies which refused to make the necessary payments to the affected employees were prosecuted. One subsequently fully settled the arrears out of Court while the other is currently appealing against this conviction. So, rest assured that MOM and CPF Board will investigate the case. If mis-classification is established, we will ensure that employers make good their obligations and to pay back the affected employees what they were due, including overtime pay and CPF contributions.