Is MOM Letting Employment Agencies Off The Hook?

2 June 2015

The Ministry of Manpower (MOM) recently issued an alert to Employment Agencies (EAs) in the Orchard Cluster, two weeks before a scheduled inspection so as to inform them about an upcoming audit that will be conducted in May.

HOME understands that such alerts are regularly issued to all agencies across the island.

Notifying agencies ahead of an audit raises some troubling issues: it undermines investigations to root out errant agencies by giving them time to clean up their operations before they are checked and allows them to violate regulations with impunity.

These alerts also come with a checklist to assist agencies to ensure they are adhering to the regulations.

However, not only are these regulations ineffective, the inspections have turned into a bureaucratic and perfunctory exercise in administrative compliance. Without an independent audit or surprise checks, it would be difficult for MOM to root out irregular and exploitative practices.

For instance, Item 10 on the Checklist forbids employment agencies to charge placement fees not exceeding 1 month for each year of service. A migrant domestic worker earning $500 a month should pay no more than $1000 for a 2-year contract. A foreign worker earning $600 per month should pay no more than $1200.

However, it is widely known that many domestic workers continue to pay an average of $3000 –  3 times more than what he Employment Agency Act allows – in placement fees. This translates to 7-8 months of salary deductions for the women when she will only be given an average monthly allowance of $10 or nothing at all for some. Agencies disguise these payments as ‘loans’ to circumvent the regulations when in reality they are placement fees.

Similarly, those which place foreign workers continue to demand kickbacks and overcharge them, sometimes demanding as much as $10,000 per placement even though these workers earn $1000 or less a month. These agencies alter their books and issue fake receipts that they have not overcharged workers.

Other examples which show how regulations have not worked include item 18 on the checklist, which reminds agencies they should facilitate the process of the employer providing a weekly rest day, or monetary compensation for forfeiting the rest day. However, agencies often pressure workers not to request for days off, threatening them if they do not comply. Fewer than 40% have a weekly day off according to a recently published report on the mental well-being of domestic workers by HOME

In another survey by HOME, which examined the living conditions provided by employment agencies housing domestic workers, it was revealed that physical and verbal abuse were significant problems experienced by these women. The women also complained that their mobile phones, passports, and valuables were seized by their agents.

However, issues pertaining to the well-being of workers are not captured in the Checklist or properly addressed by the regulations.

MOM has in the past published the names of EAs who have had their licenses revoked. Section 22C of the Employment Agencies Act also disqualifies “anyone who has been a director or in the management of an employment agency when the licence was revoked” as a key appointment holder of another EA.

However, repeat offenders can still register a new agency using the names of their friends or family members.

Employment Agencies play a critical role in negotiating employer-worker relationship and in ensuring that workers settle into their jobs in Singapore well. They need to take a more pro-active role in safeguarding the rights and well-being of foreign domestic workers. It starts with an effective regulatory and enforcement framework