Workers Still Not Paid Despite Filing Claims

This letter was sent to TODAY and and edited version was published on 16 May 2015.

HOME welcomes the news that more employers have been taken to task for salary related offences. This latest statistic is an improvement from 2009, when the Ministry of Manpower revealed in its Universal Periodic Review report to the United Nations that it only prosecuted 4 employers for salary related offences, even though it received approximately 3770 salary related claims from foreign workers in the same year.

However, we are concerned that one third of workers with claims at the Labour Court did not receive full or partial payments. Our experience shows that many face difficulties enforcing orders awarded in their favour as they are required to pay hundreds of dollars upfront in administration fees. HOME has also observed that some employers declare bankruptcy to avoid payment, only to set up a new company under a different name to escape responsibility. We urge the Ministry of Manpower and the Ministry of Finance to monitor such employers closely.

To address such difficulties, MOM could stipulate the employer to pay the arrears to the Labour Court in escrow, which will in turn be paid to the worker.  Employers are less likely to default on payment if it is made directly to the courts as they would not be able to take advantage of the worker’s inadequate resources to enforce an order.   The employer’s failure to comply would result in a penalty.

We also recognize that some bankrupt companies experience genuine financial difficulty. For such situations, HOME recommends that the Ministry of Manpower creates a fund for workers who are owed wages due to company insolvency. This fund can be financed by corporate taxes or foreign worker levies. Hong Kong’s ‘protection of wages on insolvency ordinance’ is one such measure. Singapore should consider implementing something similar.

Salary claims which are adjudicated by labour court can also take a long time and workers are often bereft of income during this period. The Ministry of Manpower should allow them to switch employers, or undertake temporary employment. Employers who exploit migrant workers by failing to pay statutory rates for overtime, work done on public holidays and rest days need to be prosecuted as these are among the most common violations. 

Justice can only be achieved when we have measures which not only deter poor employer behaviour through prosecution but are also supported by government policies which guarantee social support to workers while they pursue a claim.   Ultimately a compensation regime that adequately addresses employee wage loss for the wrongs done against them is necessary if we are to treat our migrant work force with the respect they deserve.