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Thursday, 4 February 2010

Speedier mediation for PMEs

Minister for Manpower Gan Kim Yong announced on 26 January 2010 during his opening address at the Singapore Tripartism Forum On Managing Manpower Challenges that a tripartite mediation process will be in place next year to help junior and mid-level professionals, managers and executives (PMEs) earning up to $4,500 a month to address common employment issues with their employers. (Source : Mypaper 27 January 2010)

Currently, PMEs mostly have to resort to civil litigation to settle employment disputes with their employers, which can be costly and protracted for both parties. Quite often, the disputes involved the entitlement of retrenchment benefits. Current employment laws and regulations in this area are still non-existent or immatured to protect PMEs. As a result, employers are able to take advantage of employees when retrenchment is necessary.

I had been a victim of such bad employment practices during a previous downturn when I was retrenched from my 13-year PME job and I was a member of an NTUC affiliated union . The NTUC had advised me then about the the setback of existing regulations in protecting PMEs facing retrenchment. At the end, I had an unsatisfactory meagre setllement as compared to my length of service, despite NTUC's support for my case.

Mypaper subsequently had clarified to me in an email that the mediation process covers three areas:
1) salary arrears,
2) issues arising from individual employment contracts,
3) payment of retrenchment benefits.

However, only issues concerning salary arrears can be taken to MOM's Labour Court.

Is it also due to a handicap or the non-existence of employment laws that cases could not be taken up to the Labour Court? When there are no relevant laws, how could the Labour Court be convened to hear a dispute? There would be no basis to  adjudge a case.

With no avenues to refer disputes to the MOM's Labour Court, non-unionised PMEs and those unionised but earning in excess of $4,500.00 are greatly disadvantaged. Even those who failed to seek redress through the new dispute resolution process will come to a dead end.

What are the real reasons behind this unwillingness to give ample protection by statutues to a PME facing retrenchment?

How long would the Ministry of Manpower (MOM) or any other relevant Authorities take to review current employment laws and regulations in this area?

Why is the salary cap fixed at S$4,500.00 for the tripartite mediation process?

Why is there a general reluctance by the MOM and our Government to look at mandatory payment of severance pay or retrenchment benefits in Singapore?

How long more must a PME employee wait to be adequately "protected" from unfair employment practices?

Reference : Mypaper January 27, 2010
Speedier mediation for PMEs
By Rachel Chan


  1. My understanding of severance pay and retrenchment benefits is that there is no legal basis in Singapore unless they are stated in the employment contract. The 1 month per year of service thing is market practice, no legal.
    I have the same misery during the SEA finacial crisis. The company HR told me specifically that there is no legal recourse.

  2. Hi John

    You are right. The NTUC told me the same thing.

    That's why there must be some regulations to protect all workers and PMEs. This will make it mandatory.

    If not we are even more backward than certain of our less developed neighbours. And we claimed to be a first world economy.

    We need regulations to protect the interest of the weak. Corporations, even a local SME; is still mightier than an individual.