Parliament No:13
Session No:1
Volume No:94
Sitting No:23
Sitting Date:16-08-2016
Section Name:Second Reading Bills
Title:Employment Claims Bill
MPs Speaking:The Minister for Manpower (Mr Lim Swee Say) The Minister for Manpower (Mr Lim Swee Say) Mr Lim Swee Say, Mr Patrick Tay Teck Guan (West Coast) Mr Patrick Tay Teck Guan, Mr Muhamad Faisal Bin Abdul Manap (Aljunied), Mr Zainal Sapari (Pasir Ris-Punggol), Ms K Thanaletchimi , Assoc Prof Daniel Goh Pei Siong (Non-Constituency Member), Assoc Prof Randolph Tan (Nominated Member), Mr Louis Ng Kok Kwang (Nee Soon), Mr Dennis Tan Lip Fong (Non-Constituency Member), Mr Thomas Chua Kee Seng, Mr Murali Pillai (Bukit Batok), Miss Cheryl Chan Wei Ling (Fengshan), Mr Gan Thiam Poh (Ang Mo Kio)

Employment Claims Bill

Order for Second Reading read.

The Minister for Manpower (Mr Lim Swee Say): Mdm Speaker, I beg to move, “That the Bill be now read a Second time.”

There are two main categories of employment disputes: first, salary-related disputes, such as those over non-payment or short payment of salary, allowances, bonuses, commissions and salary in lieu of notice of termination; and secondly, non-salary-related disputes, such as unfair dismissals and grievances from employees.

This Bill focuses on the first category of salary-related disputes. Today, there are three avenues for resolving them.

First, through the unions. Union members in unionised companies have recourse to conciliation under the Industrial Relations Act (IRA) and access to the Industrial Arbitration Court (IAC). Even though most of them are currently rank-and-file workers, but with the IRA amendments passed in 2015, we now allow more Professionals, Managers and Executives (PMEs) to have access to this route.

Second, employees who are covered by the Employment Act (EA) ‒ these are rank-and-file employees and PMEs earning up to $4,500 per month ‒ regardless of whether they are union members, they have access to what is commonly called “the Labour Court” at the Ministry of Manpower (MOM).

Third, all employees have access to the Civil Courts. This recourse is important, especially for complex claims which may require legal representation and take longer to resolve.

Madam, even with these three avenues in place, there is growing demand for access to an affordable and expeditious way to resolve disputes. This is especially so amongst the PMEs, whose number has increased by about 20% over the last decade and is set to grow further.

To ensure that our employment dispute resolution landscape remains relevant going forward, the proposed Employment Claims Tribunals (ECT) will help more employees resolve more types of salary-related disputes with their employers.

Let me first explain how the ECT will cover more types of salary-related disputes. The ECT will take over the Labour Court’s function of hearing statutory salary-related disputes on employee entitlements under the Employment Act (EA), Retirement & Re-employment Act (RRA) and the Child Development Co-Savings Act (CDCA). These include unpaid salary, overtime pay, salary in lieu of notice, employment assistance payment and maternity benefits. In addition, the ECT will hear contractual salary-related claims from employees. Such claims include payment of allowances, bonuses, commissions, salary in lieu of notice and retrenchment benefits, provided that these are expressed in monetary terms in the contract.

The ECT will also hear claims from the employers. However, as with the Labour Court, employers can only bring claims for notice pay to the ECT. The types of claims which the ECT can hear are laid out in the First and Second Schedules of the Bill, which may be updated based on tripartite consultations. Besides hearing more types of claims, the ECT will be accessible to more employees, compared to the existing Labour Court. Besides hearing statutory salary-related claims from employees covered under the EA, RRA and CDCA, the ECT will also hear contractual salary-related claims from more employees, including PMEs who earn more than $4,500 per month and are currently beyond the coverage of the Employment Act.

With this, all employees can now have access to the ECT for their statutory and/or contractual salary-related disputes. Public servants, domestic workers and seafarers will continue to be able to bring their statutory salary-related claims regarding employment assistance payment and maternity benefits to the ECT, just as for the Labour Court. As per current practice at the Labour Court, contractual salary-related claims of these groups of employees will not be heard at the ECT.

Public servants continue to have recourse through the Public Service’s internal processes. Domestic workers can approach their employment agencies and MOM to resolve employment disputes. Likewise for seafarers, they can continue to settle disputes, including salary-related disputes, under the Merchant Shipping (Maritime Labour Convention) Act.

I will now describe how the ECT will work. The ECT will be set up under the State Courts, with the claims to be heard by legally-qualified Tribunal Magistrates and in accordance with Court processes.

We have built in features to keep the process expeditious and affordable. All parties will be required to go through mediation conducted by MOM-approved mediators before their claims can be heard at the ECT. This is because, from our experience, it shows that mediation is an effective way of resolving salary-related claims amicably between the parties. More than 90% of Labour Court claims will be resolved at the mediation stage without having to go through formal hearings.

The claimant must submit a request for mediation within one year after the claim arises, or within six months if the employment relationship has ended. There will be no legal representation, as with the Labour Court and Small Claims Tribunals. If mediation is successful, parties will sign a settlement agreement and apply for the registration of the settlement agreement in the District Courts for it to be enforceable as a binding Court Order. If mediation is unsuccessful, the mediator will issue a referral certificate for the claimant to lodge a claim at the ECT.

Mdm Speaker, the ECT will significantly enhance the resolution of employment disputes. Even so, tripartite partners will continue to have important roles to play.

Tripartite partners will set up a new centre known as the Tripartite Alliance for Dispute Management (TADM). For a start, TADM will conduct the pre-ECT mediation and serve as the MOM-approved mediation centre for all employees, both unionised and non-unionised members. Union members today enjoy additional remedies, such as the Tripartite Mediation Framework (TMF), MOM conciliation or recourse to the Industrial Arbitration Court. This will continue.

We are also amending the IRA to expand the coverage of the Tripartite Mediation Framework (TMF) so that more union members can use this avenue to resolve more types of disputes. Today, only managers and executives earning up to $4,500 per month who are union members in non-unionised companies have access to the TMF.

We will remove the salary cap and also allow the rank-and-file employees to access the TMF. Only executive employees with substantial managerial responsibilities will continue to be excluded due to a potential conflict of interest. The types of disputes covered under the TMF will be expanded to include re-employment and other statutory employment benefits, for example, over-time pay, public holiday pay and maternity benefits under the EA and CDCA.

In addition, in recognition of the role of the unions, we have included three features in the ECT process.

First, the claims limit will be $30,000 per case for cases which go through mediation with union involvement, compared to $20,000 for all other claims.

Second, union members in unionised companies can be represented by their unions at mediation and at the ECT, and this will be as prescribed in the subsidiary legislation.

Third, union members in non-unionised companies who undergo TMF can seek consent from the ECT to have their tripartite mediation advisors observe their ECT hearings.

Mdm Speaker, I have highlighted the key features of the Bill. With the passing of the Bill today, the ECT and TADM will be established by April 2017.

In conclusion, together, these changes ‒ the proposed ECT, the strengthening of TMF and the setting up of TADM ‒ will provide for a more comprehensive and inclusive suite of dispute resolution services for all employees, while ensuring that unions and the tripartite partners continue to have a strong role to play in our employment landscape. Mdm Speaker, I beg to move.

Question proposed.

4.26 pm

Mr Patrick Tay Teck Guan (West Coast): Mdm Speaker, I thank the Ministry of Manpower as well as the Minister for working closely with the Labour Movement and finally introducing this Bill which seeks to facilitate the expeditious resolution of employment disputes by providing for mediation of such disputes and the setting up of the Employment Claims Tribunal (ECT). I also thank our tripartite partner, Singapore National Employers’ Federation, for strongly supporting the setting up of the ECT.

With the growing number of Professionals, Managers and Executives (PMEs) in Singapore, I recall mooting the idea of setting up an ECT with our tripartite partners four years ago to look into mediating and resolving employment disputes, and I am elated that it is going to come into fruition.

The setting up of the ECT is a landmark development in the area of employment law and industrial relations practice in Singapore. I applaud the setting up of the ECT for five reasons.

First, the ECT is inclusive. It plugs the existing gap of the Employment Act, which has a $4,500 salary cap for PMEs. The new ECT will be able to hear claims from all employees, regardless of their salary levels and whatever their position in the company. It even extends the scope to employees in Statutory Boards and prescribed public sector employees. In short, almost all workers, including all PMEs who are in a contract of service, will now benefit and have access to the ECT.

Second, the ECT consolidates the Labour Court, which henceforth will not exist and fills the current lacuna in that the Small Claims Tribunal does not hear employment-related claims and disputes. Parties are encouraged to resolve employment disputes amicably by requiring parties to go through mediation before their cases are heard by the ECT.

Third, the ECT will go beyond the existing coverage to what I call the 18/43 rule. The ECT will have jurisdiction over 18 types of contractual employment claims and 43 types of statutory employment claims which are availed to all workers. The positive impact would be that the many, which used to have to file a civil suit, can now save the costs of engaging counsel to pursue their contractual claims.

Fourth, it preserves the sanctity of tripartism and the unique tripartite framework via the setting up of a Tripartite Alliance for Dispute Management to advise and assist aggrieved employees in the entire claims journey.

Fifth, I am glad Minister Lim shared that the ECT does not dilute the role of unions but complements and supports unionism. Union membership is encouraged as unions can and should assist and represent union members through the ECT process. I initially wanted to request the Minister to confirm for the purposes of Hansard recording that union officials, staff and representatives can represent union members throughout the ECT process from mediation to ECT hearing as union representation is not specifically stated in the Bill. I wanted to confirm if it will be done via regulations, and I am glad earlier the Minister shared that it is allowed and I thank the Minister on behalf of the unions and the Labour Movement.

In fact, for union members, besides representation by unions, as shared by the Minister earlier, the Tripartite Mediation Framework (TMF) will also be similarly expanded with no salary limits and cover the four existing types of TMF claims over and above the 18 contractual and 43 statutory items where applicable.

Having highlighted the five positive aspects of ECT, I submit five suggestions to further augment and do even better. I call them the "5Es" and what do these "5Es" stand for? Encompassing, Economical, Enforceable, Ease of Access and Effective.

First, Encompassing. On the whole, the coverage of the ECT is now much wider than previously was the case under the Labour Court system which only applied to employees covered by the Employment Act. As of now, there are 18 contractual and 43 statutory claims. I am aware our Tripartite Mediation covers an additional four areas but I submit that MOM should support another review of the Industrial Relations Act to further expand the Tripartite Mediation Framework to extend to areas beyond the 18/43 and the existing four areas to cover those areas not covered by the ECT such as unfair dismissal of workers outside of the ambit of the Employment Act.

Or it is time to also review our Employment Act again to relook at how some of these dichotomies and whether they are still relevant. Specifically, for the $4,500 limit which appears in the Employment Act, to be removed, as even unions too face challenges from employers who often use this $4,500 as a proxy for scope of representation.

In a similar vein, I submit we should also review the Employment Act and that the ECT be further stretched to cover possibility new categories of workers such as professional freelancers who are workers themselves whether in temporary, full-time, part-time or other arrangements especially when these freelancers are more vulnerable than employees themselves who are currently protected by the Employment Act.

In addition, a point of clarification which I have is whether those under apprenticeship agreements including interns will have recourse to the ECT. I say this because we have many youths and even now new hires who are on such informal arrangements.

Second, Economical. There are two steps when one takes on an ECT action. The first would be the filing of claim and mediation and the second would be the actual ECT hearing after mediation. Though the actual costs and prescribed fees of both steps have not been articulated, I suggest that the fees and charges should be made affordable and not exorbitant so that all collars of workers can gain access. For the second step of convening a hearing, the costs and fees should be reasonable and not deter workers who need to proceed for a hearing. At the same time, all the charges must reflect and correspond to the claim amount and sufficient safeguards are in place to prevent the floodgates of frivolous, vexatious or unsupported claims.

Third, Enforcement and Enforceability. It is good that the Bill states that if the dispute is settled at mediation or tripartite mediation, the parties must enter into a settlement agreement in the prescribed form. It is in section 7(1) of the Bill. The agreement will also be enforceable if it is registered in a District Court via section 7(3). Of course, whichever way, there is still the hassle of enforcing it by a writ of seizure and sale. I certainly hope that the enforcement process can be further streamlined, made hassle-free, easier and economical so that the claimant would not be subjected to further stresses when the other party is rouge. In fact, during yesterday’s debate on the Administration of Justice Bill, I similarly urged that more rigorous and robust enforcement regime be imposed for non-compliance of ECT judgments.

Fourth, Ease of Access. The ECT as well as the upcoming Tripartite Alliance for Dispute Management should be easily accessible to all workers. In fact, the entire claims process from filing should be made simple and convenient for the layman. Proper communications and cascading should be done such as simple infographics, workflow charts or pocket guides with frequently asked questions (FAQs) to explain the workings of ECT and Tripartite Alliance for Dispute Management (TADM) in easy to read and digestible manner in a variety of languages.

Lastly, fifth, Effective and Efficient. While the introduction of mediation before the ECT hearing is convened is a positive move, it should never prevent the aggrieved workers from having their claim delayed and their livelihood and work severely affected if the case can be summarily heard or an expedited hearing can be convened without the need for mediation. I therefore urge MOM to ensure that the ECT bear this in mind and expedite hearings which is provided in this Bill so as not to be an encumbrance to clear, genuine, needy claimants and their claims.

To add, it is recommended that presiding judicial officers of the ECT should be well acquainted with employment and industrial relations issues and in particular unions and tripartism so that they can be even more effective in carrying out their role in dispute resolution and adjudication.

To stay effective and relevant, I further suggest that the claims limits be regularly reviewed and adjusted to stay relevant, inclusive and appropriate. Mdm Speaker, in Mandarin.

(In Mandarin): [Please refer to Vernacular Speeches.] I support MOM's new Employment Claims Bill. In setting up the Employment Claims Tribunal, I urge MOM to look into five important aspects.

It must be practical, effective, encompassing, accessible and enforceable, so that it not only benefits white collar and blue collar workers, but also protects freelancers, apprentices and interns; (i) it should enable workers to save on legal fees and not end up spending too much; (ii) it should expedite the mediation process and shorten case processing time for workers; (iii) it should also streamline the administration procedures; and finally, it must be able to solve the cases speedily.

(In English): In conclusion, I applaud the setting up of the ECT. This watershed milestone offers even greater protection for workers in Singapore especially the PMEs who are a growing yet increasingly vulnerable segment of our workforce. It provides an inclusive, affordable and accessible advisory, alternative dispute resolution mechanism and adjudication. With this, I strongly support the Bill. Thank you

4.37 pm

Mr Muhamad Faisal Bin Abdul Manap (Aljunied): Madam, the move to replace the current Labour Court with the Employment Claims Tribunal (ECT) is based on two main considerations. One, inclusivity; and two, enhancing efficiency in achieving resolutions.

The ECT will basically cover all employees who have an employment contract with the employers regardless of their salary level with the exception on the following three groups of employee. One, public servants; two, domestic workers; and three, seafarers.

The implementation of the ECT will also improve efficiency, shortening the time required to resolve a salary-related claim. I welcome this move in making our labour laws more inclusive and efficient. However, I would like to raise four suggestions to further enhance this Bill so that it can be more encompassing and inclusive.

Madam, in the proposed Bill, domestic workers will be excluded from filing claims when the ECT is set up. However, it opens a possibility that domestic workers may be included and I quote, "at a later date when operations have stabilised." In the meantime, affected domestic workers will have to, I quote, "approach their employment agencies and/or MOM to resolve disputes" as they are not covered by the Employment Act and thus do not have access to the Labour Court.

Madam, domestic workers are amongst the most vulnerable workers in Singapore in part due to the authority and power the employers have over them and they could possibly be in debt upon arriving in Singapore. If they are not covered from the start, requiring them to approach MOM would perpetuate all the downsides of their current claims dispute settlement mechanism that ECT is trying to resolve. As such, I propose that the Ministry will indicate the public timeline for domestic workers to be included in the overall operations of the ECT.

Madam, in the consultation paper, it is stated under paragraph 8 that ECT is meant to be an, I quote, "expeditious mechanism to deal with salary-related claims." And hence, it will not include other workplace grievances such as unfair dismissal or discrimination. Thus, I would like to propose that ECT should preferably deal with claims related to discrimination based on age, disability, race, gender and unfair dismissal. This will bring it in line with other jurisdictions such as the UK. Including claims related to other workplace grievances will make the ECT more comprehensive and useful for employees.

Madam, such workplace grievances are still commonplace in Singapore. In 2013, for instance, the then Acting Minister for Manpower, Mr Tan Chuan-Jin said that from between the period 2007 and 2013, MOM received an average of 70 cases from female employees annually, 70% of whom are pregnant mothers felt that they had been unfairly dismissed.

Madam, on the accessibility to the ECT, I would like to raise two further points. The issue here is affordability. To be inclusive in this instance is to facilitate its access to the ECT, in particular, for those are less fortunate in our midst. Access to any legal recourse should be made accessible to all regardless of their financial circumstances. This is the point that Members in this House will concur with.

Presently, claimants have to pay $5 per page for the notes of evidence and grounds of decision made by the Labour Court commissioner. Such cost can be prohibitive especially for low-wage workers some of whom may not even have received their salaries for a period of them. The ECT sets out to, I quote, "create a more accessible system" for potential employees who wish to seek readdress and higher costs may lower accessibility.

Hence, as my third proposal, I would like to propose that the grounds of decision by the ECT be made free to claimants so that they can better understand the factors considered by the ECT and thus be more aware of their rights. This can also have them decide on further actions they may wish to undertake. Notes of evidence should also be made more affordable with charges waived for low-income claimants.

Madam, I understand that under clause 34 of the Bill, fees for making claims to the ECT are not specified and the Minister has this flexibility to make regulations to the fees charged. I would like to seek clarity on what these fees are and how they will be calculated. Considering that our claimants could be facing financial difficulties and are seeking recourse through the ECT, I would like to propose that the fees are pegged at no higher than $160 for salary-related claims, a practice common in the UK, and it should be waived entirely for those in financial distress. Madam, in Malay, please.

(In Malay): [Please refer to Vernacular Speeches.] Madam, the move to replace the Labour Court with the Employment Claims Tribunal (ECT) was based on two main considerations, that is, to have more inclusivity, and secondly, to enhance efficiency in reaching resolutions.

I welcome the move to make labour laws more inclusive and efficient. However, I would like to make some suggestions to further enhance this Bill, so that it can be more inclusive.

The first thing that I would like to touch on is related to costs. I am quite concerned that the cost incurred to use the ECT’s services becomes an obstacle that causes workers, especially low-wage workers, to become reluctant to step forward and make their claims. The issue of cost should not become an impediment for anyone who wishes to obtain any legal service. Hence, with the implementation of the ECT, I would like to request that the Ministry reduce the costs that will be incurred and provide waivers for low wage workers.

In the Ministry’s Consultation Paper, it was stated under Paragraph 8 that the ECT was implemented only as an “expeditious mechanism to deal with salary-related claims”. Therefore, it does not include other aspects like job dismissals that were conducted unfairly or due to discrimination.

Here, Madam, I hope that the ECT can also include claims made by workers that are related to, firstly, issues of discrimination due to age, disability, religion, race, gender, and secondly,dismissals that were conducted unfairly. It cannot be denied that issues of discrimination and unfair dismissals still occur in Singapore. For instance, in 2013, the then-Acting Minister for Manpower, Mr Tan Chuan Jin, said that between 2007 to 2013, MOM received on average 70 cases from female workers every year, whereby 70% of them were expectant mothers who felt that they were dimissed unfairly. Therefore, Madam, I believe that the ECT can become more encompassing, and therefore bring about more benefits and become more meaningful to workers, if claims related to issues of discrimination and unfair dismissals can be included in this Bill.

(In English): Madam, in conclusion on the basis of this four proposals I have shared earlier in enhancing the working of this Bill, I support the setting up of the Employment Claims Tribunal. Thank you, Madam.

4.46 pm

Mr Zainal Sapari (Pasir Ris-Punggol): The Labour Movement welcomes the Ministry’s effort in establishing the Employment Claims Tribunal (ECT) to provide a more accessible system that can resolve salary-related claims more affordably and quickly for more employees compared to the current Labour Court. That said, there are some clarifications and suggestions that I would to make from the perspective of low-wage workers and vulnerable workers that the Ministry could look into.

First, I would like to urge the Ministry to allow ECT to look into both salary and CPF claims to make it easier for workers to file salary claims related grievances. Currently, separate claims have to be filed to CPF board for their owed CPF payments. This is taxing on their time, resources and morale. Since most salary claims are very likely to include CPF payments, making it possible to file both these claims will provide them with better assurance and more efficient work processes.

Second, I would like the Ministry to clarify section 22 subsection 2(a) in the Employment Claims Act. More specifically, how do we define when claims are deemed frivolous and vexatious and what are the considerations involved? In helping workers with salary grievances, U-Care Centre (UCC) has helped low-wage workers with claims as low as $50. Would these cases count as vexatious or frivolous?

Third, I would like to propose that the first mediation session be held at least 14 days after it is referred to the approved mediator. In section 4 for Conduct of Mediation Sessions, the Bill currently does not stipulate a time frame as a guideline for mediation cases to be resolved which I believe can open a loophole for exploitation.

Fourth, I would like to seek clarification and confirmation that the Act would allow for another person such as next of kin, unionists, UCC consultants and others to make the claim on behalf of the affected employee especially for workers who may not be intellectually sound but may still be able to stay able to stay gainfully employed.

UCC had come across salary grievances cases involving workers with intellectual disability. I believe that having a provision to allow representation for workers with some disability can be beneficial to these groups of people who may otherwise not be able to capitalise on the ECT’s role in resolving salary disputes.

Likewise as an extension, I would like to confirm provisions under sections 18 and 19 with regards to the representation of the employees who are non-union members during ECT. There will be claimants who may not have the capacity and knowledge which may hinder their capabilities to fully represent themselves adequately during mediation or tribunals. Hence, I would like to seek clarification whether the act would allow non-union members making the claim to have officers from NTUC Help Centres such as U Care Centre to follow through on such cases of salary dispute.

Fifth, I would also like to propose that administrative fees be waived for valid cases involving low-wage workers who are already affected by non-payment of salaries when they file claims. Workers who earn $2,000 and below should be given a waiver so as to not create such financial strain upon themselves as they are claiming what should have been rightfully theirs to begin with.

Last, I would like to make some operational suggestions that may ensure that the ECT can benefit as many Singaporeans who need their services. In UCC’s experience in dealing with low-wage workers, there are three factors that have been extremely beneficial for these workers. These three factors cover working hours, claim forms drafted in the various vernacular languages, and ramping up outreach and publicity efforts.

I would like to propose the ECT should operate at least one weekday evening and on Saturdays as well as these would be the off-work hours for these low-wage workers and hence enabling them to come down to make their claims.

Second, claims forms should also be in vernacular languages; and the claimant should also to be given an option to request for officers who can speak in their preferred language or dialect.

Third, I would like to urge the Ministry to ramp up outreach efforts to educate and inform workers on ECT. The Ministry should look into embarking on strong publicity efforts on educating workers, especially the low-wage, vulnerable workers, on the newly-formed tribunal.

At this juncture, I also call for the Ministry to continue giving support for centres that assist employees with workplace advisory like NTUC U Care Centre, Centre for Domestic Employees (CDE) that could render assistance to our maids, UPME Centre and Migrant Workers’ Centre (MWC). Such help centres can play an instrumental role in creating greater awareness about the Employment Claims Tribunal. Mdm Speaker, please allow me to continue in Malay.

(In Malay): [Please refer to Vernacular Speeches.] The current Bill is timely for several reasons. Firstly, it ensures an inclusive coverage of Singaporean workers who fall outside the wage limits set in the Employment Act. Secondly, it allow workers to save costs of engaging counsel to pursue salary-related claims based on their contracts. Lastly, its complements and supports unionism and I also strongly urge that Unions are allowed to represent their respective members in the claims process.

(In English): Mdm Speaker, please allow me to conclude in English. Notwithstanding the clarifications and suggestions that I have made to improve the work processes and accessibility of ECT to workers in seeking redress for salary dispute, I fully support the Bill.

4.53 pm

Ms K Thanaletchimi (Nominated Member): Mdm Speaker, I rise in support of the Bill. The working people of Singapore regardless of nationalities, types of job, union membership, age or gender requires a channel for fair and just hearing and judgment that calls for social justice. It is indeed timely that our workers be provided for an inclusive, accessible, expeditious and fair trial for employment claim matters for any specified employment dispute concerning the recovery of salary, re-employment dispute, for any specified employment dispute where an employment relationship ceased. In this way, workers in non-unionised industry sectors will largely benefit from this tribunal. However I have few clarifications to raise and hope the Minister will provide further clarity.

In order to allow for mediation process as first line of amicable settlement, the mediation proceeding is seen to be set as a precursor before one proceeds to Employment Claims Tribunal at the discretion of the Commissioner. The mediation process must be encouraged and supported for a win-win outcome. There are presently various different mediation routes to cater for various distinct class of workers as mentioned earlier by the Minister. MOM’s mediation service for employees covered under the Employment Act - that is one. Number two is Tripartite Mediation Framework (TMF) covered under the Industrial Relations Act for employees who are union members working in non-unionised companies. And third is the MOM’s conciliation service for unions and unionised companies as per provision under the Industrial Relations Act.

However, the Bill could have been made clearer as to how mediation through Tripartite Mediation Framework should proceed on Employment Claims Tribunal. Allow me to elaborate. Section 5(1)c states that a claimant “cannot be represented by an agent, whether paid or otherwise” in the ECT mediation process; and section 34(1)(d) states that “the Minister may make regulations to exempt any person or class or persons from all or any of the provisions of this Act, either generally or in a particular case”.

The question I would like to ask the Minister is – will all cases be referred to the ECT mediation process, regardless of whether the claimant is a Union member or not? If yes, will all unions then have to go through exemption ordered by the Minister in order to represent our members at mediation stage?

In terms of representation at the tribunal under section 18, section 34(1)(d) does not apply, that is Minister may not order for exemption to allow for union representation at the tribunal. However, earlier, Minister did mention that unions can represent members at the tribunal. However, the Bill does not state this clearly, so I hope there is more clarity to this.

Claim limits. According to section 12(7), there are set limits on the claims but the exact amount is silent in the Bill. Section 14 states that “a claim cannot be divided and pursued in separate proceedings before a tribunal if the only reason for doing so is to bring the total amount alleged to be payable in each of those proceedings within the jurisdiction of a tribunal”, while section 15 gives claimants the option to abandon the part of the claim that exceeds the set limit so that they can be eligible for hearing at the tribunal.

The question is – how was the limit set and why was there a limit in the first place? If the limit is not specified in the Bill, does it mean that it can be varied? How will the limits be made known? Can the claimant file for separate proceedings if he or she has multiple claims of different form? For example, if claimant has already filed for a case on his overtime (OT) pay for a few thousand dollars, will he be able to file for another hearing for his bonus payment? I hope this can be done.

What happens if there is a deadlock during the ECT proceedings or parties disagree with the decision of the tribunal? Is appeal to High Court through section 23 the only available route? Can a union member at the advice of the Union proceed further to IAC instead?

The tribunal magistrates that are specialised in this process. Do they have any experience on labour matters? If not, will this be a concern and how will it be addressed?

Time bar of employer's claims. In most cases of employees making claims, there is a time bar to the extent of their claims whereas in the case of employers making recovery of overpayments there is no similar time bar imposed. Does this time bar apply to both employers and employees making similar claims, for example short payment or over payment of overtime pay?

What happens if ECT ordered company to pay, up to the three months' pay, but thereafter company refuses, how should the claimant proceed? Under the administration of Justice Bill which was passed last night, this would be an act of contempt of court. Will the company be liable and subject to penalty or will the tribunal demand for the payment to be made good by the employer such as in the form of instalment payment or payment recovered by Writ of Seizure and Sale of Asset?

The other clarifications I would like to make is that will the Employment Claims Tribunal address claims under the Employment of Foreign Manpower Act? If not, why not? The Regulations at section 34 of the Bill leaves this question open.

As much of the evidence that employees need to prove their claim would often be in the hands of employers, can the tribunal draw an adverse inference where the employer is not forthcoming with that information so as to facilitate access to evidence?

Section 10 of the Bill seems to be silent on the contents of the record of the tribunal and whether parties are entitled to a copy of this record. It seems a stark contrast to section 13(2) of the Small Claims Tribunals Act, where another court under the same cluster which the Employment Claims Tribunal will be in, which expressly fleshes out the above. Is there a reason for this? Should the Bill go even further than section 13(2) of the Small Claims Tribunal Act and require written reasons for decisions?

Can non-monetary claims such as unfair dismissal, discrimination be included within the ambit of the Employment Claims Tribunal in future or are the alternative avenues at present sufficient? Madam, with these clarifications raised, I still strongly support the Bill.

5.00 pm

Assoc Prof Daniel Goh Pei Siong (Non-Constituency Member): Mdm Speaker, the setting up of the Employment Claims Tribunal is long overdue. This Bill is a welcome relief for workers. I am sure there will be many refinements down the road to ensure that workers get paid their rightful salaries. For now, I have a few issues that I would like to put to the Minister to address.

First, the most important feature of the Employment Claims Tribunal is that it covers workers not covered under the Employment Act, especially Professionals, Managers and Executives who earn more than $4,500 a month. The setting up of the Tribunal finally recognises that compelling PMEs to file their claims with the civil courts can be lengthy and costly, thus discouraging PMEs from pursuing their just compensation and creating the unintended consequences of protecting unscrupulous employers.

However, the obstacles faced by PMEs might return in another form with the Tribunal. This is the limit on claims amount. It was stated in the Ministry of Manpower’s public consultation exercise that claims amount would be capped at $20,000 per claim, or $30,000, if claimants go through the Tripartite Mediation Framework or MOM conciliation. I would like to clarify with the Minister if this, indeed, would be the case.

[Mr Charles Chong (Mr Deputy Speaker) in the Chair]

If so, what is the purpose of differentiating the claims limit between the two types of claimants, and why give a higher allowance to claimants going through the Tripartite Mediation Framework or MOM conciliation when these claimants have more alternative avenues to resolve their salary-related issues? Secondly, is not the $20,000 cap too low for PMEs, this being less than five months of salary for those earning $4,500 a month?

Clause 12, subsection 8, gives the Government the flexibility to prescribe different classes of employees and employers and different claim limits for different classes of claimants and different circumstances. Rather than to prescribe different classes in terms of whether they go directly to the Tribunal or through the Tripartite Mediation Framework, I believe the logical thing to do, given the differentiated employment market, is to prescribe different classes of claimants according to their salary range and set the different claim limits accordingly to ensure inclusive coverage of PMEs.

Better still, to ensure fairness to all workers, would the Minister consider a more dynamic claims limit that is pegged to six months of the claimant’s last drawn salary or $30,000, whichever is higher? The claims limit should not be pegged to the claims limit of the Small Claims Tribunal. Employment claims are by nature, by complexion and by quantum dissimilar to small commercial claims. It is very important that we send a signal to employers and employees alike that employment claims are not small claims.

The second issue is the time limit to submit a mediation request. Clause 3, subsection 2, sets out two different timings for claimants, six months after the last day of employment for disputes where an employment relationship has ended or one year after the occurrence of the dispute for other disputes, presumably where the employment relationship has not ended. This seems anomalous, as I would expect the majority of cases to fall under the former category where the employment relationship has ended.

The six-month timing is, therefore, potentially disadvantageous to the majority of claimants and also add an extra burden to workers who find themselves in the unfortunate situation of becoming unemployed and in an acrimonious salary dispute with their former employers. I believe the Government can be more liberal and understanding of the situation faced by unemployed workers by extending the timing from six months to one year. This will also equalise the timings among the different specified employment disputes under clause 3, subsection 2, making it fair for all workers.

The third issue is the question of representation before the Tribunal. Clause 5 specifies that claimants must act in person and cannot be represented by an advocate and solicitor or by an agent, paid or otherwise. On the other hand, an officer or full-time employee could represent employers for the dispute. There is a potential imbalance here that would disadvantage claimants. Companies could send their in-house lawyers or professional human resource professionals at no cost to them. In such a situation, PMEs would also be disadvantaged, not to mention rank-and-file workers and foreign workers hampered by language differences and lack of knowledge. Discretionary powers should be given to the Tribunal to allow claimants representation by advocates or agents when it is apparent that the claimants are at a disadvantage.

The fourth issue is the question of enforcement. Clause 22, subsection 11, states that a claims order made by the Tribunal might be enforced in the same manner as that made by a District Court. The Minister for Manpower said in his reply to a Parliamentary Question in May 2015 that the Ministry cleared 1,630 cases of salary disputes in 2014, but one-third of workers did not receive the full payment on the pretext that the companies who owed them salaries were facing financial difficulties. When the Ministry investigated further, 80% of the employers who did not make full payment were discovered to be able to make the full payment.

It is apparent from this that enforcement of the claim orders could be a major problem going forward, and active enforcement on the part of the Ministry is the only way to minimise the problem. The Minister said in his 2015 reply that the Ministry is looking into enhancing the protection for workers in this regard more holistically. Could we get an update on how the Ministry intends to do this to minimise non-compliance with claim orders?

Lastly, concerning the public consultation on the Bill that closed on 23 March this year, the summary of key comments received and the Ministry’s responses was not published on the REACH website or the Ministry’s website as promised. Would the Minister inform the House what are some of the key concerns the public had with the Bill and the Ministry’s responses to them? Would the Minister also please cause the summary of responses to be published online?

Notwithstanding the above issues, this setting up of the Employment Claims Tribunal is a good beginning. Mr Deputy Speaker, Sir, I support the Bill.

5.06 pm

Assoc Prof Randolph Tan (Nominated Member): Thank you, Mr Deputy Speaker, Sir. The Bill before us today will affect all major segments of the workforce, with very few minor exceptions, especially the fastest-growing group of PMETs. Since 2008, PMETs have made up a majority of the resident workforce. This is true in all three major sectors, even construction, which saw its PMET proportion just exceed 50% in 2015. It comes as no surprise, therefore, that PMETs are also increasingly represented among the unemployed and those laid off.

These changes took place very quickly. In 1990, the proportion of PMETs in the resident workforce was just half the 2015 figure; the proportion in manufacturing just a third of the 60% it has climbed by 2015. Through such rapid changes, the economy continued to maintain very low levels of unemployment.

Policymakers have been alert to the challenges arising from the rapidly changing composition of the workforce. The MOM, in particular, has not held back and instead, delved deep into the underlying problems, with initiatives, such as the Professional Conversion Programmes beginning in 2007, and the Career Support Programme in October 2015 as well. As the Minister for Manpower revealed at this year’s COS debate, his Ministry’s approach in implementing these initiatives has become increasingly direct and oriented to the individual jobseeker’s needs.

But jobs do not appear out of thin air. A labour market framework that facilitates jobs creation is needed. The recognition of this overall framework for employment has to evolve to match the needs arising from these changes. And this is exactly what the Bill today signifies ‒ an advance in our labour market framework.

In January 2015, Parliament passed the Industrial Relations Amendment Bill to extend union representation to PMETs. In August 2015, Parliament voted overwhelmingly on an amendment to the Employment Act which obliged employers to ensure that each employee is provided with properly written or electronic records of individual employment terms and salary payments and deductions.

The current Bill builds on that kind of momentum. The ultimate aim of setting up the Employment Claims Tribunal should be to strengthen HR practices among employers, and further improve labour standards in Singapore. When realised, such benefits will accrue broadly to all labour market participants, not just PMETs.

The process for making employment claims should ultimately contribute to the strengths of Singapore’s labour market, not weaken them. Complicated legislation raises the costs of adjudication and enforcement. If the employment claims process becomes difficult and costly for employers and employees, each and every dispute could potentially turn into a minefield and end up benefitting no one. To prevent these kinds of issues, a robust framework for making employment claims should ensure that all parties in any dispute progress towards a resolution in as expeditious a manner as possible. What is undesirable is to have a process which is unable to convince all parties concerned that a clear resolution has been reached. If any party to a dispute thinks matters are unresolved and continues to hold out for more, the delays will clog the claims system and the ensuing gridlock from delayed resolution will ultimately have negative consequences for the economy as a whole.

It is also important to consider the lot of small businesses. A clear and straightforward framework will benefit them as well. Unlike larger enterprises, small businesses which do not have the benefit of dedicated HR and legal departments may see a rise in business costs if the risks of employment disputes increase.

I have three main questions for clarification. The first point is on whether the role of unions can be expanded. Why does the role of unions appear limited? I know the Minister has just clarified that tripartite mediation advisors can attend as observers. And I believe that this is a significant start, and I am glad to see that it has been included.

What I am thinking of is a much more active role for unions mainly because, with union participation, you will get a balance between calls for inclusivity and the need to preserve efficiency in the Tribunal's workings. The union movement has been at the forefront of the call for such a Tribunal and is in the best position to actually help increase the efficiency of these processes while at the same time improving inclusivity. The role of union representatives or resource persons should be formalised for cases which come before the Tribunal after mediation has failed.

My second question is on the claims cap. The claims cap now clearly allows more workers, including PMETs, to avail themselves of the Tribunal as an avenue. If we consider the usual notice periods set into contracts for termination, the current caps on claims appear to have been well thought out.

But if contractual bonus payments are allowed for, then the claims cap becomes limiting. What is the reason for setting the maximum claims at $30,000, even allowing for mediation?

My last question is on guidelines for awards by the Tribunal. What will guide the Tribunal in its decisions, and what should the Tribunal not take into account in making awards? What is the process by which award guidelines are formulated? Would a body which has expertise in wage negotiations, such as the NWC or the SNEF, be permitted to comment about what the Tribunal should take into account? After all, the Tribunal's role is adjudication, not policy making. A framework for stipulating guidelines for the Tribunal's decisions and awards would clarify the approach that the Tribunal should take, in particular, whether it has to take into account the consequences of periods of higher unemployment, as well as whether it should consider the direction of the economy in setting awards. Mr Deputy Speaker, Sir, I support the Bill.

5.12 pm

Mr Louis Ng Kok Kwang (Nee Soon): Sir, I welcome this progressive Bill which expedites the resolution of salary disputes, thereby ensuring that our labour laws continue to provide better protection of workers. However, allow me to highlight five areas of concern.

My first concern is on representations in proceedings in clause 19(2)(e). While most parties are expected to act in person before the Tribunal, the new Bill allows for certain individuals to be exceptions to this rule. Can the Minister clarify who these individuals will be?

According to section 23 of the Small Claims Tribunal Act, certain parties need not act in person at Small Claims Tribunal proceedings. This includes low-wage elderly workers who have received little formal education and have a poor command of English. This group of vulnerable individuals should also be protected at the Employment Claims Tribunal.

In such cases, there is usually a significant power differential between employees and employers, even if interpreters are provided. Allowing them representation or assistance by solicitors, agents or McKenzie friends will ensure fair outcomes are achieved.

Secondly, the Second Schedule sets out the specific statutory dispute matters that can be heard by the Tribunal. However, the Employment of Foreign Manpower Act has not been included. Can the Minister explain the rationale for its exclusion? Leaving out this Act would mean depriving migrant workers of protections offered to them for salary-related claims.

Thirdly, on the rules of evidence, under the Employment Act, there have been reports of inconsistent practices at the Labour Court as to the types of evidence and witness testimonies accepted. It was previously pointed out that Labour Court Commissioners have refused to accept material evidence, such as video recordings of employers confessing to non-payment of salary.

Under clause 33(2) of the new Bill, Rules of Court provides for the summoning of witnesses and provision of evidence. It would be helpful if formal and clear rules can be put in place, and publicised, as to what types of evidence and testimonies are admitted. This would help claimants when preparing their cases.

Fourthly, I would like to highlight the need for stronger enforcement of court orders. According to charity workers, low-wage employees currently face difficulties when trying to enforce Labour Court orders or settlements obtained at the mediation stage. Although legal mechanisms, such as a Writ of Seizure and Sale, are available, these involve high costs and are usually out of reach of low-wage employees.

In order to avoid payment, charities have reported that it is common for employers to declare bankruptcy and wind up their companies, only to set up a new company under a new name. As such, I would suggest stronger rules to be put in place for the enforcement of Tribunal orders and settlements, (a) making it a criminal offence to default on these orders; (b) if directors wind up companies and set up new ones, claimants should be allowed to return to the Employment Claims Tribunal to make directors, major shareholders and officers personally liable to fulfil the orders; (c) the Employments Claims Tribunal should hold the funds in escrow to be disbursed to the claimants. Employers are less likely to default on payments to be made directly to the court; and lastly, (e) for bankrupted companies experiencing genuine financial difficulties, a fund could be created to help workers, financed by corporate tax or the security bond paid by employers. One such model is Hong Kong’s Protection of Wages on Insolvency Ordinance.

On access to grounds of decision which a previous Member has mentioned, clause 10 of the Bill provides for a Registry to keep all records of the Tribunals. However, unlike section 13 of the Small Claims Tribunal Act, it does not explicitly state that these records will be available to parties upon application. Can the Minister clarify if records will be made available?

Access to grounds of decision is important to allow employees to make informed decisions on further action to take. Under the current Labour Court system, claimants have to pay $5 per page for these records. One charity has documented a case where a claimant had to pay almost $1,000 – a large sum for low-wage workers. Can the Minister clarify if this sum will be made more affordable?

Sir, while I stand in full support of this Bill, I raise these points to ensure that the proposed Employment Claims Tribunal provides full protection for employees.

5.16 pm

Mr Dennis Tan Lip Fong (Non-Constituency Member): Thank you, Mr Deputy Speaker. I declare my interest as a lawyer who does handle employment matters and disputes in the course of my work.

The proposed constitution on the Employment Claims Tribunal to decide on employment claims as proposed under this Employment Claims Bill is indeed a step in the right direction. I have a few concerns which I hope the Minister can address.

First, I note that the Bill will only deal with salary-related claims, not other types of claims or grievances related to work or workplace. Sir, I also seek the Minister's clarification whether the Ministry intends to set up similar Tribunals that handle workplace grievances, such as unfair dismissal or discrimination.

Currently, there is no specific Tribunal to address such issues. MOM has, in previous years, acknowledged that there are such cases. In January 2013, the then Acting Minister for Manpower, Mr Tan Chuan-Jin said that from 2007 to 2012, MOM received annually an average of 70 cases from female employees who felt that they have been unfairly dismissed, out of which 70% involved pregnant women.

We should not overlook the issues of unfair dismissal or discrimination. And discrimination can involve different kinds of discrimination. We should look to the examples of other First World countries, like UK, which have an employment Tribunal handling all types of claims for quite some time now.

I would like to point out that employment claims disputes are often mired in the context of contending allegation of breaches of employment contract. Unfair dismissal or discrimination could well form part of the factual matrix in some of the cases. How would the Tribunal handle submissions or evidence on such issues? It may well be unfair to parties in such cases for the appointed Tribunals to just ignore arguments relating, for example, to unfair dismissal or discrimination. It is naïve to pretend such scenarios will not happen and it may be an injustice to employees or employers if the Tribunal were to disregard such issues or evidence completely.

Sir, instead of having different forums to hear different types of employment or labour-related disputes, may I propose that the Government should consider having one Tribunal that can hear all types of labour-related employment disputes. This may take away some cases from the courts. We can have a Tribunal that hears claims or employment claims, unfair dismissal, discrimination as well as − my colleague, Mr Faisal Manap, as well as other speakers before me, who proposed that domestic workers should also be considered to be entitled to the use of the ECT. By way of example, the Employment Tribunal in UK hears claims from employees arising from unlawful treatment by employers, potential employers or even trade unions. Unlawful treatment includes unfair dismissal, discrimination and unfair deductions from one's pay.

The Bill provides that claims must be filed for mediation within one year from the date on which the claim arises or six months if the employment relationship has ended. Comparing the statutory time limits for claims in the State and High Courts for employment contracts-related claims which is six years, the proposed time bar of one year and six months respectively is extremely short.

Will Minister explain the rationale for having such a short time limit under the Bill, especially half year? Will the Minister consider raising the limits to at least one year after the employment relationship has ended? I have asked this because six months is really a short time and it could well be that the employee was busy looking for a new job, adjusting to a new job or his or her family may require urgent attention or, as we often see in employment disputes, the employee may be communicating with his or her employers and trying to come to an agreement regarding the dispute.

Under this Bill, claims are limited to $20,000 or $30,000 for claimants to go through the tripartite mediation framework or MOM conciliation prescribed under the Industrial Relations Act. I am of the view that unlike the Small Claims Tribunal, we should set a higher minimum monetary limit for cases before the Employment Claims Tribunal. A good indication of a minimum limit should be the median annual income so that employers are less likely to be able to delay a hearing before the Tribunal on a calculation that the employee may not have sufficient resources to pursue the case in the civil courts. Hence, the claim limit should be raised beyond $20,000. Let it cover more claims involving more PMEs and PMEs with higher income rather than let it go to the State Courts or beyond, where legal costs would be considerably high.

Clause 21 of the Bill provides that a Tribunal is not bound by the rules of evidence in the conduct of any proceeding and may inform itself on any matter in such a manner as the Tribunal thinks fit. This is something which I feel is not satisfactory. If, as what I suggested earlier that the claim limit can be increased beyond $20,000, we should definitely enhance the current provision in clause 21 of letting the Tribunal not be bound by the rules of evidence in proceedings under this Bill.

I am saying this because under the proposed provisions, the Tribunal has a wide discretion whether to admit or accept evidence. The risk of a Tribunal failing to consider relevant evidence or making its decision based on arguably wrongful evidence cannot be discounted. I feel that this affects the quality of justice.

Naïve or less educated workers who may not know how best to protect themselves with written evidence or any agreement with the employers may be disadvantaged by such a system. This problem of the Tribunal not bound by the rules of evidence is further compounded by other provisions in the Bill. For example, clause 23 provides that appeal against any decision of Tribunal is to the High Court but only on issue of law or a claim being outside the jurisdiction of High Court. The High Court is prohibited by clause 25(2) of this Bill to vary the Tribunal's decision on the question of fact or to receive further evidence. Why do we not accept further evidence, especially if further evidence turn up after the proceedings?

Madam, this Bill is indeed a step in the right direction but I hope we can do much more with the proposed Tribunal.

5.23 pm

Mr Thomas Chua Kee Seng: Mr Deputy Speaker, in Mandarin.

(In Mandarin): [Please refer to Vernacular Speeches.] Mr Deputy Speaker, first I would like to declare that I am an employer. Setting up the Employment Claims Tribunal to settle conflicts between PMETS (professionals, managers, executives and technicians) and employers is a good move. However, conflicts only need to be settled because there are conflicts. We hope that employers and employees could find a way to smoothen their communication channels to avoid unnecessary conflict.

After this Bill has been passed, employers have to step up on their knowledge in this. Some SMEs have no HR departments, and the work of human resources is usually handled by the Administration Department, or personally taken charge of by the boss himself. PMETs will be implicated under the new legislation. Since most PMETs are well-educated, dealing with them is very different from that of blue-collar workers, in terms of concept and process. Whenever conflicts arise, and need to be raised in the tribunal, just the preparation of documents, and following up on detailed procedures, would be extremely exacting for the SMEs.

Hence, I really hope that this Act could form a standard reference for HR management, and that employers and PMETs could fully understand the content to avoid getting into conflicts which are impossible to mediate. At the same time, I also hope that the Employment Claims Tribunal could accurately assess which claims are reasonable and which are not reasonable at all. Local enterprises are all facing severe manpower shortage, and due to economic restructuring, every trade and industry is trying to reshuffle its resources. SMEs also hope to take the opportunity to recruit more PMETs and fully utilise their potential. However, if PMETs and employers can work together cordially, enterprises do not need to waste time and energy to address these conflicts, which only ends up aggravating the situation.

I also have some concerns regarding the salary-related claims to be handled by the Employment Claims Tribunal. Within the company, any personnel changes, including promotions, demotions, organisational restructuring, performance appraisals, retrenchments, resignations, and other management issues, are all eventually salary-related. Then how does one differentiate between standard HR adjustments and unreasonable salary conflicts? Such cases should be carefully dealt with at the Employment Claims Tribunal, to avoid being abused by employees.

5.26 pm

Mr Murali Pillai (Bukit Batok): Mr Deputy Speaker, I declare my interest as a lawyer with a practice involving employment disputes.

The Employment Claims Bill seeks to establish an Employment Claims Tribunal within the State Courts to facilitate the expeditious resolution of certain specified employment disputes.

In addition, the Tribunal will replace the Labour Court, which is a dispute resolution mechanism currently administered by the Commissioner of Labour to adjudicate on employment claims by employees who are covered by the Employment Act. In contrast, the Tribunal’s jurisdiction will extend to adjudicating on employment claims of employees not covered by the Employment Act, such as professionals, managers and executives. Therefore, the Tribunal will provide such employees with quicker and relatively cheaper options of dispute mechanisms than having to commence a suit in the civil courts.

I support these objectives. I take the opportunity to highlight and seek clarification on the following four areas.

First, section 19 of the Bill requires that parties to proceedings before the Tribunal must act in person. A similar provision exists for mediation under section 5 of the Bill. A body corporate may be represented by its officer or full-time employee, but parties cannot be represented by an advocate and solicitor.

This is understandable given that the objective of the Tribunal is to provide a cost-effective mechanism to resolve the specified employment disputes. While I acknowledge that the Tribunal is likely to play a more inquisitorial role than the civil courts in adjudicating the specified employment disputes, I am concerned that in certain situations, there may be an "inequality of arms" between an employer and employee before the Tribunal. This would arise if an employer should be represented before the Tribunal by a legally-trained employee. I gather from the Minister today that he intends to allow union members be represented by union representatives. Does he contemplate that these representatives would be legally trained and, if so, how would that reconcile with the principle of section 19 of the Bill?

I understand that the Tribunal will be limited to hearing employment disputes of up to S$20,000 for normal cases or $30,000 for claimants invoking mediation or conciliation under the Industrial Relations Act. The quantum of a claim per se is not indicative of the complexity of the claim. While the majority of cases before the Tribunal are contemplated to be straightforward claims, there could be cases involving legal and factual complexity, for example, where a dispute requires an interpretation of terms or where an employment contract with a Singaporean is governed by a law other than Singapore law. In such cases, the Tribunal would benefit from proper representation of parties’ respective cases.

A possible way to address such cases is to allow the Tribunal to appoint an assessor on an ad hoc basis, somewhat analogous to section 33 of the State Courts Act which allows a District Judge to, if he thinks fit, on the application of any party, or his own Motion, summon to his assistance a person of skill, and experience in the matter to act as an assessor.

This is also similar to the approach adopted in section 60 of the South Australian Employment Tribunal Act 2014 which allows the Tribunal to refer any question arising in any proceedings to a special referee for the purpose of procuring a decision or opinion which the Tribunal may or may not adopt. This suggestion may, in part, at least address an issue raised by the hon Member Mr Zainal when he highlighted the plight of employees suffering from certain disabilities.

Second, I support the objectives of requiring parties to mediate their employment disputes first before their cases may be heard by the Tribunal. In most cases, this would be the most efficient dispute resolution mechanism as highlighted by the Minister just now. UK also has a similar procedure, under section 18A of the Employment Tribunals Act 1996

Notwithstanding the benefits of mediation, I highlight that in one specific situation, the requirement of compulsory mediation imposed by the Bill may pose a disadvantage to the employee. By way of an example, where an employee has unsuccessfully mediated a specified employment dispute, such as leave entitlement. He has lodged the claim with the Tribunal for that dispute, but before that claim is heard by the Tribunal, the employer acts in a manner that gives rise to a second specified employment dispute, such as withholding salary. Under the Bill, the occurrence of the second specified employment dispute is one that the employee would have to submit a fresh mediation request. In such a situation, it appears that the compulsory mediation of the second dispute would lead to duplication of resources and be less cost-effective contrary to the objectives of the Bill.

It would be more cost and resource efficient for the Tribunal to be able to deal with both disputes at the same time. In this regard, while the Tribunal is empowered under section 18(5) of the Bill to hear the two claims together, this would result in a delay to the employee having to obtain redress for both claims as he would have to wait until the second dispute has been mediated.

A way to deal with such a situation is to empower the Tribunal to, upon the application of a party, to order the second dispute to be heard without a claim referral certificate. This is what the UK has done by way of its Employment Tribunals (Early Conciliation: Exemptions and Rules of Procedure) Regulations 2014.

Thirdly, whilst the creation of the Tribunal to hear salary-related monetary claims would allow employees to resolve employment disputes more quickly, an unintended effect may be the added complexity because of the potential overlaps in the roles of the Tribunal, Commissioner for Labour and the Minister. Section 16 of the Bill thus seeks to minimise such multiplicity of proceedings. In particular, in relation to the salary-related disputes under the Employment Act, section 38(e) of the Bill will make consequential amendments to Section 115 of the Employment Act, to provide that the Commissioner must not inquire into or decide a salary-related dispute unless the dispute is of a type prescribed by regulations made under section 139 of the Employment Act.

Having regard to that fact, the Tribunal is expected to take over the work of the Commissioner for Labour in adjudicating salary-related claims. Could the Minister please clarify what kind of regulations under the Employment Act are contemplated and in what situations would it be permissible for an employee to make a claim to the Commissioner under the Employment Act?

Finally, section 16(7) of the Bill provides that where an employee has lodged a claim for an employment assistance payment under the Retirement and Re-employment Act (RRA), the employer cannot rely on the defence that an employee does not satisfy the reemployment eligibility criteria set out in section 7(1) of the RRA if the employer did not raise this defence during the mediation required under Part 2 of the Bill. Could the Minister please clarify what is the rationale of this subsection? This provision on surface seems odd for a few reasons.

First, Section 16(7) of the Bill appears antithetical to the purpose of mediation. Mediations encourage amicable settlement of disputes by encouraging parties to speak freely about their issues. And it has been very successful as the Minister observed earlier. Parties are usually assured that what is discussed during mediation will not be used against them in a subsequent claim. Further, parties are generally discouraged from relying on or referring to their strict legal positions at mediation.

Second, Part II of the Bill which deals with mediation of employment disputes does not require an employer to raise the defences he wishes to rely on at the mediation stage. If no such requirement is imposed, would it not be inconsistent for section 16(7) of the Bill to preclude an employer from relying on a defence that it is not required to raise the same during mediation?

Third, given that mediation under the Bill is to be conducted in private and in general, discussions between the parties during mediation are private and confidential, how would the Tribunal be apprised of what was discussed during the mediation given that it was not present at the mediation?

Finally, given that legal representation is disallowed at such mediations pursuant to section 5 of the Bill, the representative of the employer attending at the mediation may not be an individual who is well-versed with the provisions of the RRA, and who may not be aware that he or she would have to expressly rely on the defence afforded under section 7 of the RRA.

In conclusion, notwithstanding my comments on the Employment Claims Bill, I agree the Bill will facilitate expeditious and affordable resolution of employment disputes. I support the Bill.

5.37 pm

Miss Cheryl Chan Wei Ling (Fengshan): Mr Deputy Speaker, I stand in support of the Bill and would like to make some suggestions to further improve matters in this area.

In April this year, the Employment Act was enhanced to facilitate better administrative records and for employees to better understand employment terms and benefits. According to the Tripartite Alliance for Fair and Progressive Employment Practices (TAFEP), 259 complaints were received about unfair practices at workplace in 2014, compared to 475 made in 2013. While there is a trend of decline in the complaints, most of the complaints received were related to hiring practices which disadvantaged Singaporeans and they were based on age, language and race.

However, there has been little survey statistics available about percentage of unfair dismissal of workers. Similarly, not much attention has been given to unfair practices that go unreported by the workers who were so affected who may not be covered by the Act or due to lack of knowledge on their entitlements or for fear of losing their jobs especially when the job market is weak.

Though I agree that not all complaints and claims should be viewed with a negative light, lest we think the current job market is skewed with unbridled bad practices; but the need to continue pushing for a fair and inclusive workplace behooves us to look at these areas where current coverage is lacking and has to be enhanced.

And since the primary purpose of the proposed Employment Claims Bill is to facilitate the expeditious resolution of employment disputes by providing mediation for such disputes, I think there should be prior steps made available that assist employees to make informed decisions or assessments of whether they should raise their cases and how best for those as covered under the Act not to overburden our mediation system. So, here, I would like to highlight three areas that I urge the Ministry of Manpower (MOM) to review and consider.

The first area, increasing employees’ awareness of employment terms and basic legal structure of contracts and service agreements. Annually, we have fresh cohorts of graduates who are looking to join the workforce at around this time of the year. Many of them would be delighted to have been gainfully employed and offered an employment even before they graduate. But how many of us would recall our first ever employment contract and what it really contains?

To most that are hired as permanent employees, they may remember having signed a contract that contains pages of information and at best they would likely take interest in remembering a few things – their monthly salary, bonus scheme, annual leave and maybe termination notice period. On one hand, we can say this is a blessing as one should really not have to focus on the contract details regularly when they are contentedly engaged in their day jobs. But on the contrary, when an unfortunate situation does arise, it may be a difficult and costly affair for some of them who did not fully understand what they had been contractually bound from the start.

While it is useful that the enhanced Employment Act mandates stipulating these key employment terms (KET) in writing, but the administration of KET does not necessarily reduce the misunderstandings or even minimise disputes that arise. I suggest that MOM considers with WDA or now WSG and SkillsFuture agencies to provide access on basic knowledge related to contracts, service agreements, common HR practices to all working age adults, so that they are better equipped with understanding the latest industry practices and mentally prepared to handle these situations when they arise.

This will also be useful for those undertaking the part-time work, mature workers or workers that are transiting back to workforce, fresh graduates and those workmen who are not covered under any industries specified under the WorkRight initiative. This way, for those that are not covered under the Employment Act or will not benefit from the Employment Claims Bill currently, they will be more aware and be better informed to ask the right questions during the contract negotiation. And it is the first step in preventing them from getting into the unknowns.

The second area, provision of support during and after the claim mediation period. Often, we assume that all these workers who have been unfairly dismissed or treated at work will eventually be duly compensated when their cases are proven and supported. However, many do not know that the consequences of a worker being unfairly dismissed, mistreated or sudden dismissal goes way beyond the monetary compensations. Some of the downsides do include difficulty of being re-hired due to uncertainty by their prospective hiring companies as to why they have been dismissed in the first place, long waiting periods for professionals to search for equivalent matching jobs, diminishing self-confidence of those who are financially strapped during this claim period, and inability to cope after they have been reinstated post the findings, and so on.

Personally, I have some residents whose MPS cases are of this nature. Let me just cite two real life experiences. Firstly is that of a resident in her early forties. Before she was laid off, she held the position of a HR Director in an MNC. Her dismissal was not due to misconduct or even restructuring, but she was at the end of fifth month into her pregnancy. It was her first pregnancy. One would imagine that she would know how to handle the situation because of her background in HR and the fact that she is a senior manager. On the contrary, she was devastated and she tried to seek for help but she had no avenues to turn to, and the Employment Act excludes her from any coverage for the mere fact of her salary range. So, though the company did compensate her financially at the end, she was physically not prepared to fight for her rights which she believed she was actually justified to have even more. And the costly process gave her second thoughts because the child was going to be due soon. Searching for a job after her maternity leave would be a second challenge for her as she juggles between her new born baby and also seeking for a job of a similar scope and seniority.

The second case is that of a resident whose monthly salary is $1,900 and works for a local SME for past 18 years. He is aware that he has not been appropriately paid for some of the components in his work package and the matter has come to the attention of the company because there is a group of similar workers just like him a few years ago. While some of his colleagues have been duly adjusted in their packages and they have been paid for the missing monies, it was not so for his case. But because he is actually the sole breadwinner and he has minimal paper qualifications, he is afraid of losing his job if he stresses upon this any further with his HR. He thus remained in his job and decided to pursue all overdue claims if he is able to, only provided that he can secure a job externally and because he has got four members in his family to care for.

So, having a claims process and tribunal may be a start for those seeking help, but the claims and appeal cases to be heard could easily take between six months and up to a year. This is a very arduous waiting period, and mentally and physically taxing for many of these workers especially those who have special circumstances, like those who are sole breadwinners, unexpected health conditions and actually silent individuals who do not dare to contest for their job rights or make the next "big" move into the next job. So how can the Ministry of Manpower assist this group of individuals?

The last area – the path of pursuit in terms of the promotion of all these concepts, implementation and enforcement. TAFEP, I recognise, is putting efforts to expand and play a very key role in changing mindsets of the employers and all the HR practitioners, so that you build a good workplace architecture in order to get a fair and progressive workplace.

I recognise that to push this in a widespread universal practice across the board is a very huge task and it requires active participation from all responsible parties in the workforce, not just MOM. Promoting and education become the natural first steps in all this raising of awareness. However, just relying on the influencers or even some of these advocates of the like-minded practitioners to push the agenda for fair workplace practice with the SMEs and private sectors may take a very long while to materialise.

In an open economy, companies are more susceptible to dynamics and impact of all the external market forces. Increasingly, we have observed that trends and all these indicators reflect our workplace as one where it is commonly seen with frequent company restructuring, reduction in breadth of our industries, earlier retirement of our skilled workers and difficulty in well-educated mature workers being re-employed.

Over time, these trends are invariably more challenging to be dealt with. In order to resolve them, it requires multi-pronged approaches to strike a balance or to mitigate its effects, and many of these effects go beyond the basics of what we considered discrimination of age, race or even language at the workplace.

I encourage the agencies to consider stepping up on audits, do external valuations to benchmark, identify and stem the current weak practices in some of the sectors while the educational aspect continue to be communicated and implemented. I feel one area to look into urgently is that of the employment agencies, particularly those that are outsourced. These HR firms actually have very short-term commitments and also non-contractual commitments to the employees who are being hired on behalf of the hiring companies. The parties who are impacted would be those of the freelancers, the part-timers and the mature workers.

For those who have to make career switches due to the market conditions or with their acquired upskills through their lifelong learning, it will be beneficial for them to have better visibility and understanding of practices in the new industries before they venture into it.

In conclusion, I believe that the Employment Claims process can be better implemented and will be well balanced without unduly impacting on critical resources when all these updated market practices and necessary legal framework and information are widely made accessible to most of our workers, not only restricted to those who are being protected under the Act.

Awareness and roll-out of these good practices would only more effectively circumvent the need for extensive mediation on the long run. Hopefully, through all these different support networks, our vulnerable working groups and our PMEs could improve their job opportunities and achieve fair work packages.

5.48 pm

Mr Gan Thiam Poh (Ang Mo Kio): Thank you, Deputy Speaker. I support the Bill, which will provide for the expeditious resolution of salary-related disputes through the Employment Claims Tribunal (ECT). I am happy to note that most employees, regardless of their salary levels, will have access to this resolution avenue. For now, civil servants, domestic workers and seafarers will be excluded as they have other avenues. However, I hope that they will be included soon to ensure universal access, and reduce confusion and duplication. In addition, may I suggest that the ceiling for claims be pegged to our inflation rate so that it will be revised periodically in a timely manner?

I am disappointed that other workplace disputes, such as emotional and physical abuse, discrimination and unfair dismissal, cannot be resolved through this Tribunal. Workers will still have to pursue these claims through MOM, if they are covered under the Employment Act, or through the civil courts, which can be costly. Deputy Speaker, in Mandarin.

(In Mandarin): [Please refer to Vernacular Speeches.] Recently, one of my residents approached me for help as his employer in the marine engineering sector had been cutting his pay repeatedly to force him to quit. His case is not uncommon. There are also employers who place unreasonable demands on their workers or practise psychological warfare to pressure them to resign. Most employees cannot afford the legal fees to prove their cases and seek compensation for such maltreatment. Employers are aware of this and some exploit their workers in the knowledge that they will not be held accountable. Illiterate, mentally and physically disabled and elderly employees are particularly vulnerable. I urge MOM to look into this loophole and close it for better protection of our workers. Having a dedicated Tribunal which can investigate and mediate will provide more assurance for our workers. It would be necessary to put a cap on the legal fees or provide legal aid so that suffering workers will not be deterred from making legitimate complaints.

(In English): Next, I would like to ask what happens if the employer has filed to wind up the company or if the proprietor/partners have been declared bankrupt. In such scenarios, there will be a limitation as to how much the Tribunal can help the employees. Would the Minister share with the House what provisions does the Court have in such situations?

I note that under clause 15, the claimant may abandon the excess amount, so that the tribunal has jurisdiction to hear and determine the claim. However, once the claimant has abandoned the excess amount, he cannot recover that amount in a Tribunal or any other Court.

I feel strongly about it. I feel otherwise. I think that the claimant should be given the option to pursue the excess subsequently, even those within a limited time frame. We must understand that most of our population are working people with immediate financial needs to meet – children to feed, education, medical fees, mortgage, instalment payment, parents to support, and so son. The expeditious recovery of salaries due is to minimise hardships to the claimants and their dependants. When the claimant’s situation is stabilised later, he should have the chance to recover any additional funds. He should not be penalised for choosing a quick interim solution to reduce the negative impact on his family.

Finally, I would like to ask on behalf of some employers, what provisions this Tribunal have for cases where the employees had wilfully injured themselves in order to file claims against their companies. Can such cases be adjudicated through this Tribunal? Thank you.

5.53 pm

Mr Lim Swee Say: Mr Deputy Speaker, first of all, I thank all the Members for their views and suggestions, as well as for supporting the setting up of the Employment Claims Tribunal. Members have brought up many points. Before I respond to them to the best of my ability, let me just set the stage first, and take a step back.

In the Second Reading of this speech, I highlighted that right now, there are three avenues for workers to settle their dispute with their employers – by becoming a union member, through the Labour Court as well as through Civil Court. These three avenues complement each other. We are not trying to find one solution to replace all three because each one on its own serves a very important purpose.

For example, unions must continue to be allowed to play a very important role because if the day were to come where our legal framework becomes so comprehensive that unions no longer have a role to play, eventually the Labour Movement will become weak. When the Labour Movement becomes weak, the day will come when the workers can no longer be protected adequately in all aspects of work.

Just look at what is happening in USA today. The Labour Movement is weak; everybody recognises it. In recent years, we have heard many public reports, lamenting that the weakness of the labour movement in the USA is today a major weakness in their labour landscape. But in the case of USA, will they be able to find a way for the labour movement to be strong again? This is something for them to worry about, to think about.

In Singapore, the Labour Movement is strong, it is healthy. Tripartism is strong, it is healthy. Let us keep it that way. Therefore let me stress, firstly, that it is not our intention to weaken the role of the unions through ECT. Secondly, it is not our intention to make ECT so comprehensive that it solves all problems. ECT is meant to be a cheaper, better, faster way of resolving disputes. Cheaper – must be highly affordable, more so than the Civil Courts. Better – because it must be able to help more and more employees, including those not covered by Employment Act, to have access to ECT. Lastly, faster – we want the disputes to be resolved as quickly as possible.

Against that backdrop, let me start by saying that I know many of you will be disappointed by my response, but please bear in mind this. I think Member Mr Dennis Tan or Assoc Prof Daniel Goh said that ECT is a good start. I fully agree with him. That is our intention. We want to have a good start to ECT and this good start need not be the ending point, it is just a good start. Against that backdrop, let me try to respond to some of the specific points.

First, Mr Patrick Tay asked about apprentice and interns who are under contracts of service. Yes, they would have recourse through the ECT.

Mr Patrick Tay and Mr Zainal talked about frivolous claims. Let me assure Mr Zainal that all valid claims will be heard regardless of the claim amount. So even $50 can be a valid claim.

Mr Zainal Sapari asked whether employees filing for CPF claims can come under ECT. Deputy Speaker, non-payment of CPF contribution is an offence. Workers do not have to claim for non-payment of CPF. All they need to do is notify CPF and we will take enforcement action on their behalf.

Mr Faisal Manap and Mr Dennis Tan asked why not include foreign domestic workers. We have mentioned it before that foreign domestic workers and other category of workers already have access to separate mechanisms today. Today their claims are not under the Labour Court. ECT, for a good start, will take over the role of the Labour Court and not beyond that. Therefore, for these categories of workers, we will look to include them in future phases of implementation.

Time limit – six months, one year. It is debatable. Based on our experience in Labour Court, six months and one year would be sufficient to cater for most cases. But one important point is that based on our experience in Labour Court, evidence become harder to gather, harder to collate, as the time passed by. As a result, we believe that by imposing this time limit, it will actually force both employers and employees to take quick action. If you have a claim, make it quickly, why wait? And bear in mind, there is a limit of $20,000, $30,000.

The longer the workers wait to file their claims, the more the workers accumulate their claims, the more likely they are going to be affected by the claim limit. So, I would say that having a faster claim works to the advantage of the workers. Do not wait.

On claim limit, why $20,000? If I set it at $50,000, Members will ask why $50,000? If I say $100,000, Members will ask why $100,000? The answer is very simple. Today, the Labour Court, we have a $20,000 limit for the PMEs, for the rank-and-file, there is no limit. But we discovered that, for the rank-and-file, $20,000 is more than adequate. As a result, we decided to continue the existing claim limit of the Labour Court. But this number is not cast in concrete. We will review from time to time through tripartite consultation.

Mr Gan Thiam Poh asked why the claimants cannot recover their abandoned claim amounts in other courts. This is to avoid multiple proceedings in different courts and tribunals over the same dispute. This is in line with the State Courts' existing practice. It is not something new to the ECT.

Mr Zainal Sapari asked about the timeframe for mediation sessions. For Labour Court claims, the first session is arranged within a month, usually within 14 working days. We will continue with this best practice under the ECT.

Mr Murali asked whether new claims that may arise between mediation and ECT hearings can be combined. The answer is, yes, we will consider his suggestion. However, I would prefer to limit it to only similar and related claims because, if the claims are completely different, it is better that they go through mediation. But I take his point.

Representation at the ECT. Many Members talked about legal representation. The reason why we insist on no legal representation at ECT is because we think this will work to the disadvantage of the workers. Because if we allow legal representation, it is more likely that the employer will be able to afford legal representation as compared to the employee. But, more importantly, as I have mentioned, we want the ECT to be a very affordable, very expeditious way of resolving disputes. Any complex cases that require legal representation, they should go to the Civil Court rather than come to the ECT. We are not saying that this is not important; we are just saying that it is outside the scope of the ECT.

Several Members also asked about the representation at ECT. I just want to confirm again that for union members in the unionised companies, they may be represented by the unions at mediation and at the ECT hearings. Union members in a non-unionised company, who undergo the Tripartite Mediation Framework (TMF), can seek consent from the ECT for their tripartite mediation advisors to observe their ECT hearings. These will be prescribed in the subsidiary legislation, in black and white.

Mr Zainal asked whether the next-of-kin (NOK) can make the claim for some members. Generally speaking, claimants must make their claims in person. But in cases where the employee does not have the capacity to represent himself, his NOK may apply to the courts to be appointed as a deputy under the Mental Capacity Act. Once appointed as a deputy, the NOK may then submit a mediation request on behalf of the employee.

Some Members also expressed the concern on what if the worker is not able to express himself, not able to present his case fairly due to whatever constraint, then whether the judgment will be a fair one. Here, I want to assure the Members that the Tribunal Magistrates appointed to the ECT will be legally qualified and they will decide on each case, its merits and in accordance with the relevant legislation, case law and legal principles.

The ECT will adopt a judge-led approach. So, the judge will lead the Tribunal and may allow individuals with relevant skills and experience to act as assessors, as suggested by Mr Murali. The ECT may also summon any person to give evidence or produce relevant documents. Parties may appeal to the High Court against an ECT order on grounds of law and jurisdiction. In other words, all these measures are to ensure that there will be a fair outcome.

In terms of the processing of ECT cases, I would like assure Mr Patrick Tay that ECT and TADM will continue to prioritise the urgent cases, which is what we are doing in Labour Court today.

I agree with Mr Patrick Tay that the claim process should be simplified where possible. At the same time, Mr Zainal Sapari also asked about the ECT's operating hours and having some claim forms in the vernacular languages.

Mr Deputy Speaker, this ECT is part of the State Courts system. ECT will align its processes with that of the other State Court tribunals. MOM will work with the State Courts to customise the services of the ECT according to the needs of the workers.

Mr Louis Ng had some questions regarding ECT records and grounds of decisions. MOM and the State Courts will explore these matters in the drafting of the subsidiary legislation.

On the ECT fees, Mr Patrick Tay, Mr Louis Ng and some other Members touched on the affordability of ECT fees. I fully agree that the fees should be kept affordable. In fact, that is the whole purpose of the ECT. We will consider various suggestions, for example, to tier fees by claim amounts and so on. Mr Faisal Manap was concerned that the fees may be set too high and he hoped that it would be set below $160 or something like that. We will bear that in mind.

I would also like to assure Mr Zainal Sapari and Mr Faisal Manap that the ECT will be accessible to low-wage workers and we will waive the fees for deserving cases, which is in line with today's State Courts practice.

Enforcement of the ECT orders. Ms Thana asked how the ECT orders can be enforced. If the orders are not complied with, they can commence debt recovery by applying to the State Courts for a Writ of Seizure and Sales. I think Members are concerned about what if the workers do not know how to go about doing this, and whether it will be too costly for them. I am happy to share with Members that TADM will assist them. TADM will give them advice and assist them to go through that process.

Assoc Prof Daniel Goh referred to my reply to a PQ on 11 May 2015, mentioning that of those employers who did not comply with the Labour Court's orders, 80% of them turned out to be able to pay. Maybe the way I put it was not so clear. So, I wish to clarify. What I meant was that of all the employers who receive Labour Court orders, 80% were able to pay. Only 20% did not make the full payment. Of those 20% who were unable to make full payment, the majority of them were due to financial difficulties, in some cases, going out of business.

For those who wilfully disobeyed the Labour Court orders, they can be prosecuted under the Employment Act for salary offences. So we do have the mechanism to prosecute them. We have done so and will continue to do so.

To help the local vulnerable workers who are caught in situations where companies may not have assets to be seized or may have stopped operations and are unable to make the payment, Assoc Prof Daniel Goh, Louis Ng, Cheryl Chan, Gan Thiam Poh and members asked whether we can do something to help them. I am happy to say that MOM is in the process of establishing a short term relief fund to assist such workers, and this fund will be administered by TADM. More details will be disclosed later.

On public communication, I agree with Members ‒ Mr Patrick Tay and Mr Zainal that it is important to raise awareness about ECT and TADM, including the rules and processes. So, MOM certainly will work with tripartite partners and key stakeholders to do so.

I also agree with Mr Chua who highlighted that it is important for the employers, especially the SMEs, to enhance and raise their HR competencies so as to avoid disputes rather than to be faced with disputes. We will do our part as well to help to upgrade the HR capabilities amongst the SMEs.

Mr Murali asked what kind of claims will continue to come to the Commissioner for Labour under the Employment Act. With the setting up of the ECT, the Commissioner for Labour will continue to hear claims related to the transfer of employment to another company because of restructuring, and claims related to the recovery of salary not paid in legal tender. These will not be under the ECT. In addition, the Commissioner for Labour will continue to handle non-salary-related disputes, such as unfair dismissal.

Mr Murali asked why is it that employers should raise the issue of re-employment eligibility during mediation and not during the ECT hearing. I want to clarify that under the Retirement and Re-employment Act (RRA), re-employment eligibility is determined by the MOM. If the employees and the employers have disagreement over the re-employment eligibility, the employee should come to MOM and we will get it settled. Once it is determined that the employee is eligible for re-employment, if they cannot agree on the payment of the Employment Assistance Payment (EAP), that is where the ECT will come in to rule whether the payment is adequate and appropriate.

Assoc Prof Daniel Goh asked about the outcomes of public consultation conducted earlier this year. We did receive feedback, and many of the feedback were similar to the issues raised by the Members today. A summary of the feedback and the response will be made available online on the REACH platform following the debate in this House.

Mr Deputy Speaker, establishing the ECT is a big step forward, but is not the final step. It is just a good start. We are going to do much more.

For example, Mr Patrick Tay asked about reviewing our employment legislation. Over the years, we have progressively expanded our EA coverage for PMEs. We first extended salary protection under the EA to PMEs earning less than $2,500 because, prior to that, there was no coverage for PMEs. In 2008, we included PMEs earning less than $2,500 under our EA. This salary ceiling was raised to $4,500 in 2011. In 2014, we amended the EA to give PMEs some non-salary protection, such as sick leave benefits, unfair dismissal. We will continue to work with the tripartite partners to regularly review our employment legislation, including the EA salary ceiling as suggested by Mr Tay.

Mr Tay also asked about covering more types of disputes under the TMF. Today's Bill now allows the TMF to cover a broader range of disputes, including salary-related and non-salary related disputes, like re-employment. We will continue our discussions with the tripartite partners for the TMF to cover more non salary-related disputes, such as unfair dismissal. This is something we will do through tripartite consultation.

Mr Faisal Manap, Mr Dennis Tan, Ms K Thanaletchimi and Mr Gan Thiam Poh also asked whether the ECT could hear non salary-related disputes in future, including unfair dismissals, workplace injury claims, discrimination and so on. The tripartite partners have deliberated at length and we have decided and agreed that the ECT should start with resolving salary-related dispute claims in an affordable and expeditious manner now, before we consider to expand the scope of the ECT to hear non salary-related issues in future. So, not now, but in the future. The tripartite partners will continue to deliberate on this issue.

In conclusion, Mr Deputy Speaker, I want to come back to the point made by Assoc Prof Randolph Tan. It is a very important point. At the end of the day, what we really want to strive for is having good progressive HR practices at the workplaces so that disputes can be prevented. I share his views completely.

The ECT is a solution to resolving disputes. However, we must not forget that at the end of the day, avoidance of disputes is better than resolving disputes.

I also agree with Mr Thomas Chua's point about paying more attention in supporting the SMEs. We will be doing even more to help the SMEs to keep upgrading their HR capability. I share Mr Thomas Chua's concern that if the ECT mechanism is made too complicated, many SMEs may not be able to cope with it. That is the reason why we have set up the ECT as a first step to be as simple and direct as possible.

I believe that the establishment of the ECT and TADM is an important step forward in addressing salary-related claims for all workers and, hopefully, will create a more comprehensive dispute management landscape here and lay the foundation for us to continue to update and evolve the dispute resolution mechanism in Singapore. Mr Deputy Speaker, with that, I beg to move.

6.16 pm

Mr Murali Pillai: Mr Deputy Speaker, I am grateful to the hon Minister for providing very detailed explanations. I have one short clarification to make in relation to his answer about a claim under the Retirement & Re-employment Act.

The Minister mentioned that the employment eligibility criteria are set by the Ministry. The thrust of my question is not that. It is in relation to the fact that the defence of the employer can only be raised if the employer had raised it in the course of mediation. The problem with that is that mediation is usually seen as a "without prejudice" kind of a discussion where there is a certain level of candour expected. Perhaps, as a half-way point, one way to deal with this issue is to provide, under the regulations, that the employer would be raising this defence on a headline basis that the employee did not satisfy the criteria, without really going into the facts and details. So, that it is highlighted at the mediation stage and, later on, if it proceeds to the Tribunal stage, the Tribunal can take cognisance of whether or not the employer had declared that this would be a defence to the employee's claim.

Mr Lim Swee Say: Mr Deputy Speaker, I will discuss that with the tripartite partners. My understanding is that, if a case is relating to the payment of Employment Assistance Payment (EAP), the first to be established is whether the employee is eligible for re-employment because, if the employee is not eligible for re-employment, then the payment of EAP does not arise.

So, at the mediation stage, if the employer feels that the employee is not eligible for re-employment, that is where he should bring it up during the mediation. And if the mediator agrees with the employer that the employee does not qualify for re-employment, the case is closed.

If the employee disagrees with the mediator that he does not qualify for eligibility, he can come to the MOM, and MOM is the final decision maker to decide whether a worker is eligible for re-employment. Once the MOM rules that the person is eligible for re-employment, then the mediation will proceed. After the mediation, if there is no outcome, they will go to the ECT. That is my understanding of how it works. So, by the time it goes to the ECT to re-debate on the eligibility of the employee, it is, in a way, setting back the whole process all over again.

Assoc Prof Daniel Goh Pei Siong: I have a minor clarification for the Minister on the "80%, 20%" point. I am quoting the Minister from the Hansard: "At the same time, employers were also taken to the Labour Court to settle the payments to the workers. For that, last year (2014), we cleared about 1,630 cases. And of these cases, two-thirds of the workers were able to receive full payment. However, one-third of them, due to financial difficulties faced by the companies, received either partial payment or no payment. We investigated further into those employers who were not able to make full payment and we discovered that 80% of the employers were able to make full payment but 20% of them were unable to pay due to financial difficulties."

So, it seems that of the one-third that initially did not pay to the workers to settle the claims, 80% were found to be able to make the full payment because of MOM's investigation. That is my clarification. My questions are: Did MOM actively then enforce the order on this 80% and get them to make the full payment to the workers? Would MOM then continue to do so for the ECT?

Mr Lim Swee Say: Mr Deputy Speaker, I thank the Member for the clarification. I read the Hansard as well, and I think the way I worded it may have created this wrong impression. This is the reason why I thought it is important that I clarify it here. Basically, what I meant to say was that of all the companies, of all the employers who received the Labour Court order for payment, 80% actually were able to make payment. Only 20% did not make the full payment.

Of the 20% that did not make full payment, some of them did not have assets to seize, some of them had run into financial difficulties or they had closed down their businesses. For these, obviously, there is no recourse. For those who are actually able to make payment, but for whatever reason refuse to make payment, we prosecute them under the Employment Act because this is a salary offence. In other words, even with ECT, we still have the right to pursue employers for failing to make salary payments.

Ms K Thanaletchimi: Sir, I have just one clarification. Section 10 of the Bill seems to be silent on the contents of the record of the Tribunal and whether parties are entitled to a copy of the records. Will the decision of the ECT be made available to the parties in written form?

Mr Lim Swee Say: Mr Deputy Speaker, this will be in accordance with the State Courts procedures. For example, whether the issue of re-employment eligibility, was discussed in mediation, the information will be made available to the ECT. Likewise, the records of the ECT, as I had replied earlier to the suggestions made by Mr Louis Ng, we will work together with the State Courts to look into these proposals.

Assoc Prof Daniel Goh Pei Siong: The Minister said that MOM will continue to prosecute those who do not want to pay under the Employment Act. But would this cover the PMEs because the Employment Act does not cover the PMEs?

Mr Lim Swee Say: Mr Deputy Speaker, Sir, for those who are covered under the Employment Act, we can prosecute them under the Act. For those not covered under the Employment Act, the advantage of the ECT is that the order of the ECT is now enforceable by registering the settlement outcome with the District Court. That is a big plus.

By the way, for TMF, that is, likewise, the biggest improvement. Salary-related settlement agreements at TMF are now enforceable through registration with the District Courts.

Question put, and agreed to.

Bill accordingly read a Second time and committed to a Committee of the whole House.

The House immediately resolved itself into a Committee on the Bill. - [Mr Lim Swee Say].

Bill considered in Committee; reported without amendment; read a Third time and passed.