Government accepts National Wages Council Guidelines for 2019/2020

1. The Government accepts the National Wages Council (NWC) Guidelines for 2019/2020.

2. The Government welcomes the stronger emphasis placed on employer-led training this year, and agrees that training is key to continued productivity gains and sustainable wage growth. The Government supports the NWC’s recommendations for employers to:

a. Offer structured training to their employees based on current and future business requirements;

b. Continue implementing productivity initiatives, and work towards better wages and skills; and

c. With respect to unionised companies and NTUC-e2i partners, establish Company Training Committees and build up their in-house workplace learning capabilities.

3. Employers can tap on the wide range of support under the Adapt & Grow Initiative and SkillsFuture to implement their training plans, and on government schemes such as the Enterprise Development Grant to improve productivity and job quality. The Government will continue to provide structured training to ensure the continued employability of its employees.

4. The Government notes that while productivity growth (in terms of value-added per worker) in 2018 was healthy at 2.4%, it has moderated from 3.9% in 2017. The economy is also expected to slow in 2019 amidst increasing external headwinds. The Government agrees with the NWC that wage increases will need to be sustainable and fair, based on the performance of individual employers and contributions of individual employees. For employers that have done well in 2018 but face uncertain prospects, they may exercise moderation in built-in wage increases but should still reward employees with variable payments. Our flexible wage system provides a sustainable way for employers to adjust wage costs more quickly in response to volatility in the business environment.

5. The Government welcomes the NWC’s recommendations for low-wage workers, namely that employers grant a built-in wage increase of $50 to $70 for workers earning a basic wage of up to $1,400 and, for employers who achieved a productivity gain in 2018, provide a further one-off payment of $200 to $360. The Government supports the NWC’s move to build upon the success of earlier tripartite efforts to raise the wage threshold and cover more low-wage workers for its quantitative wage recommendations. This helps to sustain efforts to improve wage outcomes for low-wage workers. The Government will continue to take reference from the NWC guidelines in its annual wage increment exercise.

6. The Government recognises that fair and progressive contracting and employment practices are necessary to uplift outsourced low-wage workers, support senior workers and retain experienced workers in the workforce. The Government will continue to take the lead in providing flexible work arrangements to support the differing needs of its employees. As a buyer of outsourced services, the Government will continue to take the lead to best source and strongly encourages other service buyers to do the same. We also call upon service providers to adopt NWC wage recommendations for their workers and call upon service buyers to enable their service providers to adjust contract values to do so.

7. The strong tripartite partnership in the NWC has contributed to better wage and employment outcomes for our workers, while ensuring that our businesses stay productive and competitive. The Government is confident that with the commitment of the tripartite partners, the NWC 2019/2020 Guidelines will be successfully implemented.