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High Court Victory Sets Precedent for Migrant Workers’ Rights

Chinese worker Liu Huaixi challenged the Ministry of Manpower’s decision to allow the employer to pay him less than promised

Imagine paying thousands of dollars to land a job with a faraway employer you’ve never met or signed a contract with.  That’s an unavoidable reality for many low wage migrant workers.  Often, prior to arrival, the only assurance they have about the employer, job type and salary is their In-Principle Approval letter (IPA).  The IPA is issued by the Ministry of Manpower (MOM) based on the employer’s application.  It serves as the worker’s entry visa.

More crucially, from the worker’s perspective, the IPA may be the only evidence of the employment terms they had agreed to, especially in the absence of a contract.  The IPA’s importance is recognised in the law, which provides that the worker’s wages cannot be lowered from the IPA figure unless the worker gives prior written consent and MOM is notified.  In practice, these safeguards are widely ignored.

The legislative intent of the IPA is quite clear, as evidenced by an extract of this speech delivered by the then Minister of Manpower, Mr Tan Chuan-Jin:

MOM has also put in place measures to ensure that foreign workers are kept informed on their salary components prior to entering Singapore. Since June 2011, employers have been required to declare the foreign worker’s basic monthly salary, allowances and deductions when making their Work Permit applications. These declarations are clearly stated in the copy of the In-Principle Approval (IPA) letter that Work Permit holders are required to present to immigration officers to gain entry into Singapore. To further ensure that Work Permit holders understand their employment terms, we have provided IPA letters in native languages for foreign workers and will be doing so this year for foreign domestic workers

Even though the intent is to ensure workers are “kept informed” of how much they are paid, there are no safeguards to ensure that they are paid according to what is promised. MOM officers handling disputes routinely allow employers to underpay them. Last year HOME saw 116 cases in which salaries paid to workers were different to what was declared in the IPA letter.  Workers who suffered underpayment for months, in fear of losing the job which cost them so much, and with no real option of speaking up, would find their forbearance and tolerance used as evidence against them.

As unfair as this principle was, appealing against decisions of MOM officers (sitting as the ‘Labour Court’) is so costly and arduous that it was not until late 2016 that this was challenged in the High Court by Liu Huaixi with the support of HOME.

Ms Sharleen Eio of TSMP Law, who acted for Liu pro bono, relied on the law’s implicit acknowledgement of the IPA’s significance.  The senior High Court Judge who heard Liu’s appeal, Justice Lee Seiu Kin, called this “a nuclear-bomb argument”.  He dismissed the employer’s argument (which was also MOM’s view) that Liu had accepted the lower salary by continuing to work for two years.

For cases where the amounts disputed are small, usually written judgment would not be issued.  But recognising the significance and public interest of his decision, Justice Lee published written reasons last week. This judgment is just one more step in ensuring fairer outcomes in salary claims.

But significant gaps remain: not least, employers’ de facto power to force workers into accepting lower salary.  This is allowed by current regulations as long as the worker signs an agreement and the Ministry of Manpower is informed. The Ministry is not required to investigate an employer’s decision to pay a worker less after he or she has arrived. This leaves it open to abuse. Workers indubitably find it difficult to object as they have little bargaining power. Justice Lee in the judgment also acknowledges the weakness of the current system:

Indeed, I would go so far as to state that even if there was a written contract of employment which provides for a monthly basic salary of less than the sum stated in the IPA, the burden would lie on the employer to show why the IPA figure does not reflect the true salary.    

Let’s hope the Ministry takes heed.

 

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