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Speech by Mr Sam Tan, Minister of State for Manpower, in reply to the Motion on Support for Seniors moved by MP Henry Kwek

Employment practices

Motion

SUPPORT FOR SENIOR CITIZENS: That this House recognises that seniors are a gift to our society, contributing to a wise and resilient Singapore, and calls on the Government to continue strengthening support for seniors to age with dignity and spearhead community efforts to create a society where they can thrive.

Introduction

  1. Mr Deputy Speaker, I would like to thank Members for tabling this motion for the House to recognise our seniors.
  2. The Ministry of Manpower, along with our tripartite partners, is committed to supporting our older workers to enjoy fulfilling years and engage in productive work. 

Ageing Workforce

  1. Our workforce is ageing rapidly. Over the last decade, the proportion of residents aged 60 and over in our labour force has increased from 6.1% in 2007, to 13.8% in 2017. We expect this trend to continue in the foreseeable future as Singaporeans live longer and healthier. 
  2. It is a good thing that our seniors can and want to work longer. Active participation in the workforce allows seniors to make positive contributions and forms part of active ageing. The economy and society as a whole benefit from their expertise and experience.
  3. To this end, we should continue to support older workers to have meaningful employment opportunities. At the same time, we should ensure that our older workers are treated fairly and with respect at our workplaces.

Re-employment of Older Workers

  1. Our tripartite partners have been working closely together to help support our older workers so that they can have longer and fuller working lives.
  2. We introduced the concept of re-employment under the Retirement and Re-employment Act (RRA) in 2012, to support older workers who want to work longer beyond their retirement age. We took another step forward in 2016 to raise re-employment age from 65 to 67, which has been effective since 1 July 2017. This applies to both the public and private sectors.
  3. The re-employment model has shown encouraging results. Since it was introduced in 2012, over 98% of private-sector local employees who wished to continue working at age 62 were offered re-employment. Of those who accepted re-employment in the same job at age 62, around 96% did not receive any cut in their basic wages in 2012. This proportion rose to 98% in 2016.

Removing Retirement and Re-employment Age

  1. Some Members have suggested: why not remove the retirement age and re-employment age altogether?
  2. Currently, the tripartite partners are of the view that the retirement and re-employment age still play an important role in helping our workers stay employable for as long as they can. These are their reasons:
  3. First, the retirement age of 62 provides older workers the peace of mind that employers are not allowed to terminate their employment simply based on age.
  4. Second, with the re-employment age, the older workers are further protected as employers must offer eligible workers re-employment up to age 67.
  5. Third, the introduction and progressive raising of re-employment age instead of retirement age balances the employers’ need for business flexibility and the employment needs of older workers better. While the employer is obliged to offer re-employment to the older worker at 62 until 67, it need not necessary be for the same job or at the same pay. Also, beyond the re-employment age, older workers can continue to work so long as there is mutual consent between them and the employers.
  6. With extended lifespans and improved health among seniors, there will be scope to raise the age of re-employment further again over time. This, however, will be a matter for tripartite deliberations. As the re-employment age was just raised from 65 to 67 last year, the immediate focus of the Government and tripartite partners is to ensure successful implementation of the new re-employment age to benefit more older workers. This is to fulfil what we had earlier set out to do.

Support for Employers

  1. As we encourage employers to hire and retain older workers, we recognise that those who do so deserve extra support and encouragement. The Special Employment Credit (SEC) scheme provides a wage offset of up to 8% of monthly wages to employers when they employ older workers aged 55 and above. An additional wage offset of up to 3% of monthly wages is also provided to encourage continued employment of older workers above the re-employment age of 67.
  2. We also support employers to provide Flexible Work Arrangements (FWAs) for older workers who prefer to transit from full-time employment to take on more flexible work options. The Work-Life Grant funds each company up to $160,000 over four years to implement FWAs1 to help employees better manage work and family responsibilities.

Progress

  1. Our various programmes to improve the employability and employment of older workers have shown encouraging results. Singapore’s employment rate of residents aged 65 to 69 is 41.5%, in 2016. This compares favourably with developed economies, with Singapore ranked 5th against 35 OECD countries in 2016. It is also higher than some of the developed countries with no retirement age, such the US (31%), Australia (25.9%), UK (21%) and Denmark (19.1%).

Ensuring Dignity of Older Workers

  1. Looking ahead, as our workforce continues to age, I strongly support Mr Henry Kwek’s call to do more to maintain the dignity of our elderly. For older workers to work productively and help companies to remain competitive, we must ensure that our workplaces are age-friendly. We must treat our older workers fairly with dignity.
  2. How do we this? First, we should eliminate ageism at work. MOM and our tripartite partners are against age discrimination. The Tripartite Alliance for Fair and Progressive Employment Practices (TAFEP) promotes the employment of older workers and raises awareness of the value that older workers bring to the workplace. They look into all age discrimination complaints and refer cases to MOM for investigation where warranted. Enforcement actions will be taken against employers who discriminate based on age.
  3. The Tripartite Guidelines on Fair Employment Practices also spell out the principles of fair and merit-based employment which we expect all employers to abide by. For example, job applicants should be assessed fairly and not be ignored or rejected on the basis of age. This applies to all jobs listed on the JobsBank. The Guidelines also state specifically that date of birth information should not be asked in the job application forms.
  4. Second, we should ensure that our jobs are suitably designed and re-designed for our older workers. This was why we enhanced WorkPro in July 2016 to create easier, safer and smarter jobs for older workers. A company can now receive up to $300,000, up from $150,000 under the WorkPro Job Redesign Grant.
  5. Since the enhancement, more than 600 companies have applied for the Job Redesign Grant, benefitting more than 9,500 older workers. This is an encouraging start and we should do more. I urge more employers to tap on WorkPro to take bold steps to redesign and create meaningful jobs for older workers.
  6. Third, we need both our older workers and employers to play their parts to enhance the employment and employability of mature workers. We will keep strengthening our support through SkillsFuture and Adapt & Grow.
  7. For instance, under the Adapt and Grow Initiative, older PMETs are provided with more support for career or job transition under programmes such as the Professional Conversion Programme and Career Support Programme. The Work Trial programme also allows older rank and file workers to undergo short-term work trial with companies and acquire new skills to potentially take on new jobs. I urge more employers and workers to take full advantage of these Government schemes we have for them.

Conclusion

  1. Mr Deputy Speaker, we have made steady progress to enhance the employability and employment opportunities for our older workers. With an ageing workforce and a fast pace of economic restructuring, we will need to do even more to ensure that our future workforce will remain inclusive. Together with our tripartite partners, we will press on in our efforts to support our seniors so that they can continue to lead an active and fulfilling life.