SINGAPORE – Salary disputes, involving employees not being paid for overtime work, or not receiving adequate Central Provident Fund (CPF) contributions from their companies, may be resolved more effectively in the future.
This is thanks to new legislation which may kick in over the next two years, requiring all employers to issue their workers with payslips that contain an itemised breakdown.
Such transparent payslips will list an employee’s basic salary, overtime pay, additional payments, allowances, deductions and his employer’s CPF contributions, according to a set of guidelines released yesterday.
These guidelines were developed by the Ministry of Manpower (MOM), the National Trades Union Congress and the Singapore National Employers Federation, following consultations with stakeholders.
MOM said it has received feedback that many small and medium-sized enterprises (SMEs) – such as mom-and-pop stores and hawkers – would find the issuing of such payslips challenging. The guidelines are aimed at helping these businesses prepare for the impending change.
“MOM’s intent is to eventually mandate the issuance of payslips within the next two years,” the ministry said.
Mr Mark Hall, vice-president and country general manager of Kelly Services, said this is “a step towards matching international human-resource practices”, adding that such laws already exist in countries like Britain.
MP Zainal Sapari, who sits on the Government Parliamentary Committee for Manpower, said that without an itemised payslip, it is difficult for employees to know what they are actually being paid for.
“It’s possible that employers might have underpaid them in terms of overtime payment, or for working on rest days or public holidays,” he noted.
Mr David Leong, managing director of recruitment firm PeopleWorldwide Consulting, said itemised payslips will address the plight of those in the “bottom layer of rank-and-file jobs”.
Casual or part-time workers, like waiters working at hotel banquets, for example, are often not issued payslips and go “unaccounted” for in companies, Mr Leong explained. Because of this, these employers may be able to avoid making CPF contributions for these workers.
He added that some companies may also “inflate” the salaries they declare for their foreign workers, so that they meet MOM’s foreign-manpower hiring policies. Without payslips, “unfair” deductions for housing and transport can later be made to lower the actual wages paid.
A coffee-shop owner who declined to be named said that some workers would rather not have payslips, so they can receive a larger component of cash in their wages, rather than see it go to their CPF account.
Mr Kurt Wee, president of the Association of Small and Medium Enterprises, expects businesses to adapt to the guidelines in the next 12 to 18 months, well within MOM’s timeframe, but he noted that smaller firms may face challenges.
By April, companies will be provided with simple payslip booklets, downloadable templates and funding support for companies to develop customised solutions.