Forum Reply: Senior Workers should be re-employed on reasonable wages and terms

We refer to the letter, “Petition for the re-employment of low-wage seniors” (21 Aug) by Mr Yao Chee Liew.
All workers, including senior workers, should be fairly remunerated based on merit. Under the Tripartite Guidelines on the Re-Employment of Older Employees, any wage adjustment for re-employed employees must be based on reasonable factors such as productivity, duties and responsibilities. It is also possible to adjust wages to remove seniority-based wage components.

In 2021, more than 9 in 10 seniors who were re-employed in the same job did not experience any cuts to basic wages and benefits. Employees who feel that they have received an unreasonable offer of re-employment can reach out to their union or the Tripartite Alliance for Dispute Management at www.tal.sg/tadm/contact-us for assistance.

The Tripartite Guidelines allow employers to re-employ workers on a term contract of at least one year. This contract should be renewable until the re-employed worker reaches the statutory re-employment age of 68, as long as the employee continues to remain medically fit and has satisfactory work performance. This enables senior workers to continue working if they wish to, while giving employers the flexibility to adjust employment terms during re-employment based on their needs.

Mr Yao has called on the National Wages Council (NWC) to recommend reasonable adjustments in its next set of guidelines. The NWC will continue to champion fair, inclusive and sustainable wage growth for our workers while ensuring that our businesses stay productive and competitive. The 2023/2024 guidelines will be released by early November.

As a society, we have made great strides in improving senior employment outcomes. The Government will continue to work closely with both employers and employees to create an age-inclusive workplace that values our senior workers for their contributions.

Lee Chung Wei
Divisional Director
Workplace Policy & Strategy Division
Ministry of Manpower

Petition for the re-employment of low-wage seniors, 21 Aug 2023, Zaobao Forum, p24

Singapore is currently facing the challenge of an ageing population and is even on the brink of becoming a super-aging society. Coupled with low birth rates, this has led to a shortage of manpower, especially in the service industry. To address this, besides hiring MWs, the Government encourages healthy and retired elderly individuals to rejoin the workforce. Many low-income families, who rarely save during their working years, must continue working after retirement to sustain their livelihoods. Therefore, they respond to the government's call to re-enter the labour force. Unfortunately, in many cases where retired seniors are rehired, they are often offered lower salaries compared to younger employees, and typically under one-year contracts that require renewal annually.

Employers usually state that these older individuals have lower physical stamina and are assigned lighter duties, which justifies their lower wages. If that were the case, it might be understandable. However, the nature of the work for these rehired seniors often isn't much different from that of their younger colleagues. In such instances, I believe employers should uphold the principle of equal pay for equal work and provide salaries equivalent to their duties. Logically, contract wages should be higher than those of full-time employees since contract workers lack other forms of job security.

I have a friend who was a self-employed individual running a hair salon before retirement. Due to difficulties in hiring experienced hairdressers, she closed her business a few years ago. Feeling healthy and with time on her hands, she applied for a job at a government hospital near her home in 2019. Her job title was "Health Care Assistant," and her basic monthly salary was only $1,330, with a three-month probation period. After she underwent basic training during her employment and performed well, her base salary was adjusted to $1,490. Shockingly, this low wage persisted for two years. It was only in 2021, after her contract expired, that her monthly base salary was increased to $1,680. Her job responsibilities were no different from those of young hospital employees. At times, she would even voluntarily help nurses with tasks beyond her job scope. Yet, her salary remained lower than that of many hospital staff members, solely because she was a retired rehire.

To address this unfair wage system, I hope that the National Wages Council can recommend reasonable adjustments in the next round of setting annual wage and employment-related guidelines. This will help retirees who have re-entered the workforce, silently contributing to our shrinking labour market, feel valued and appreciated.

Yao Chee Liew