In brief
Singapore’s Prime Minister Lee Hsien Loong, at his recent National Day Rally speech, acknowledged the anxiety felt by middle income Singaporeans over foreign work pass holders, especially with the economic uncertainty heightened by COVID-19.
Addressing what he described as personal and emotional arguments by Singaporeans over perceived foreign competition for jobs and opportunities, the prime minister signaled that the government will introduce new anti-discrimination laws with a range of penalties extending beyond the current administrative penalties, such as restrictions on an employer from hiring foreign workers.
Key takeaways
Based on the prime minister’s brief policy statements, all employers, particularly those reliant on foreign finance and information technology employees, should anticipate the following:
- continued progressive tightening of work pass criteria, such as continued increases to salary thresholds for Employment Pass (EP) and S Pass applicants1; and
- a move from voluntary compliance with the Tripartite Alliance for Fair and Progressive Employment Practices (TAFEP) to:
- writing these TAFEP guidelines into law
- setting up a workplace discrimination tribunal
- expanding the range of enforcement actions
Although a draft of these anti-discrimination laws has not yet been released, we expect these laws to draw from the current TAFEP guidelines, and the new workplace discrimination tribunal to have a similar approach as the Employment Claims Tribunal has to claims arising from non-, or under-, payment of salaries and wrongful dismissal.
Accordingly, and to prepare for the coming into force of these new laws, employers should familiarise themselves with both the TAFEP guidelines and the Fair Consideration Framework (FCF) guidance against all types of discrimination based on characteristics unrelated to the job, including on the basis of nationality.
Employers should ensure their employment practices are fair and merit-based across all areas such as hiring and recruitment, performance development and dismissals and retrenchments.
Employers should also note that the new TAFEP-based law will protect all workers, Singaporean or non-Singaporean, against discrimination, as well as prohibit other kinds of discrimination — age, race, religion, and disability— covered by TAFEP against male and female employees.
In more detail
The Employment of Foreign Manpower (Work Passes) Regulations 2012 currently requires all employers to undertake reasonable efforts to provide fair employment opportunities to citizens of Singapore.
The Ministry of Manpower (MOM) has interpreted compliance with the regulations and the FCF guidance not just on account of individual Singapore citizen employees (“Singapore Core”) on a company-wide assessment, but also taking into account industry norms. In 2016, the Minister of Manpower stated that, when assessing whether an employer would be placed on the FCF watchlist for behaviour that adds to the deepening of the “local-foreign” divide, the MOM will consider evidence of the following triple weaknesses:
- weak in Singaporean Core
- weak in commitment
- weak economic linkage and social impact
More recently, the minister has added that, in shortlisting employers for the FCF watchlist, the MOM will also assess whether the employer has:
- a high concentration of foreigners from a single nationality source
- a high share of foreign professionals, managers, executives and technicians relative to industry peers
However, the minister has admitted that effective as this MOM assessment is, the process is resource-intensive. Additionally:
- Refinements to the EP framework, which primarily rely on salary as a gatekeeper to select complementary talent, although easy to understand and administer, still require the MOM to explore additional steps to achieve the objectives of a strong Singaporean Core, complemented by a diverse foreign workforce.
- Despite progressive enhancing of the FCF and stiffening penalties further for discrimination cases, TAFEP nonetheless handles an average of 170 nationality discrimination cases arising from complaints annually.
Thus, with the minister stating MOM’s intent to clamp down on egregious employers with discriminatory employment practices by strengthening levers and employing options to give more bite to TAFEP, it is unsurprising that the prime minister broached concerns over work pass holders, a delicate subject, for a National Day Rally.
However, both the minister and the prime minister have also underscored the importance of keeping the right balance between requiring businesses to invest in a strong Singaporean core even as they complement it with a diverse foreign workforce. Singapore will not turn protectionist or otherwise damage its reputation as an international hub. In facing the many challenges in the post-pandemic era, Singapore will make it crystal-clear to the world that it is determined to stay open, with outward- and forward-looking policies.
Looking ahead, we will keep you informed on developments for this new anti-discrimination law. If, in the meantime, you have any queries on this or any related employment matter, please feel free to contact us.
1 For more information on the measures to tighten work pass criteria for foreigners and their working family members, please see our previous alerts:
- Continued tightening of the work pass requirement and significant updates on the work pass salary criteria
- Dependant’s Pass holders to apply for work pass instead of Letter of Consent to work • Tightening of employment pass regulations for overseas intra-corporate transferee
- Dependant’s Tightening of employment pass regulations for overseas intra-corporate transferee
