EMPLOYMENT BILL

Order for Second Reading read.

3.37 p.m.

The Minister for Foreign Affairs and Minister for Labour (Mr S. Rajaratnam): Mr Speaker, Sir, I beg to move, "That the Bill be now read a Second time."

Sir, before I go into the wider political and economic problems this Bill is designed to meet and overcome, I would like, first of all, to deal with significant details of the Bill itself. Since the Bill was introduced on 15th May. 1968, there has been considerable discussion on it. Some of this has been constructive and pertinent but, unfortunately, a great deal, too, has been no more than excited gossip based not on what the Bill really contains and seeks to accomplish but on rumours of what the Bill is supposed to contain. Even allegedly progressive intellectuals and defenders of workers' rights have been making indignant pronouncements without, I suspect, having read the Bill itself. These criticisms have been very much like those of the highly emotional advocate who concluded his case by saying, "This then, gentlemen of the jury, are the opinions on which I have based my facts."

It may, therefore, be helpful for debate inside and outside Parliament were we to first get right our facts about this Bill.

There appears to be some misapprehension that the Employment Bill, as a whole, is a new piece of legislation designed radically to alter our labour laws. This is not true. The bulk of the Bill merely brings together in a convenient and systematic form the existing Employment Ordinances which have grown piecemeal year by year. Mr Speaker, Sir, a reference to the comparative table will show that only 10 clauses or, roughly, six per cent of the total number of clauses in the Bill are new. It follows, therefore, that some 94 per cent of the clauses in the Bill merely re-enact existing labour legislation. A few of the old clauses have been modified or refined to meet the objectives of increased productivity or to generate new employment or to iron out anomalies.

Yet some enthusiastic critics, unaware of this fact, have attacked some of these re-enacted clauses in the belief that these were innovations to deprive workers of their hard-earned rights.

As for the overall impact of the new provisions in the Bill, it will cut into some of the fringe benefits enjoyed by a minority of the total working population in Singapore - the organised sections of the white collar workers. Even here, as a result of representations made by N.T.U.C. leaders, the Government has agreed to consider certain modifications to the Bill as it was originally presented. This is in order to enable these workers to adjust themselves to the fact that labour laws and practices should aid and not restrict rapid industrial growth and economic expansion. Let me state here that we are not restricting certain types of fringe benefits either because we want to make life miserable for workers or because, as it is alleged, we want to enrich the rich at the expense of the poor. We in the Government are not going to get a cent for ourselves by enriching the capitalists. On the contrary, if, as politicians, we had wanted to ensure the popularity of our party and thus assure ourselves of a longer political life, it would have been in our interests to have presented a Bill the opposite of what is now under consideration. In many newly independent countries, politicians out to be popular with the people, and particularly with the workers because they happen to be in the majority, have invariably persecuted and impoverished the capitalists in the belief that as the rich become poorer, the poor would become richer.

We have studied these examples with great interest and in every case the result has been contrary to what was expected: the capitalists certainly have grown poorer but the poor have grown poorer still. We need only look around us for evidence of this. The economies of all these countries are in ruins; the rich maintain their wealth and profit through corruption, loot and reckless exploitation of the poor which yearly grow in size and in the measure of their desperation.

It is because we have learnt from the bitter experiences of those who promised prosperity without tears and without effort that we have decided to promise prosperity the only practical and effective way - the hard way. It is not a popular way - that is popular with a weak and effete people. But we do not believe that our people are weak or effete. We belief that if they can be told the hard facts of life honestly and bluntly, they will respond to the challenges ahead.

But the people will respond provided they are convinced that the effort and difficult adjustments demanded are really directed towards eventually promoting the well-being of the people as a whole and not merely to enrich a privileged few - whether gay and fun-loving political leaders or the racketeering ruffians with whom they are allied.

We have brought this Bill because we believe that though it will prevent the misuse of certain fringe benefits enjoyed by some categories of workers, it will nevertheless ensure the long-term economic well-being of all the workers and the people of Singapore.

Let me now deal with specific clauses in the Bill.

Before I discuss the provisions of the Bill, I would like to state here that consultations have taken place between the Government, the Employers' organisations and the N.T.U.C., following which certain modifications and refinements have been made by Government to some provisions in the Bill with which I shall deal in detail later on. The Member for Bukit Ho Swee has also tabled notice of amendments which he proposes to move.

The Bill abolishes the current statutory definition between clerks, industrial clerks, shop assistants and workmen. It brings within its scope all persons who are employed under a contract of service, other than those employed in a managerial, executive or confidential position, all of whom would enjoy standardised working conditions. Further, Government employees will not be affected unless declared by the President to be employees for the purposes of the Act. The provisions of the Bill will not apply to domestic servants unless the Minister so declares by notification in the Gazette.

Clause 10 on notice of termination of contract has been the subject of criticism by certain quarters. The point has been missed that the notice periods prescribed apply only in the absence of any provision for notice in the contract of service. It is also worthwhile to point out that the notice periods are similar to those provided in the British Contract of Employment Act, 1963, and if such periods are considered fair and reasonable by the United Kingdom workers, then there seems to be no reason why these periods should be considered a retrograde step in Singapore.

Clause 15 of the Bill prohibiting the employment of a person after the age of 55 years was made to ensure that the unproductive and inefficient do not continue in employment at the expense of more productive and able youngsters in the labour market. However, this provision has evoked fears amongst older workers and a certain amount of misgivings from employers in respect of older workers whom they consider skilled and experienced and essential to them.

In view of these apprehensions, the Government will give consideration to the amendment which will be formally moved by the Member for Bukit Ho Swee at a later stage.

Part IV of the Bill on rest days, hours of work, holidays and other conditions of service apply only to workmen and other employees who are in receipt of a salary not exceeding $750 a month or such other amount as may be fixed from time to time by the Minister.

Clause 37 stipulates that the weekly rest day shall be Sunday or any other day as determined by the employer by way of a monthly roster. However, to enable flexibility in the arrangement of shifts, a rest day of a continuous period of 30 hours may be substituted for the usual rest day of 24 hours which is normally from midnight to midnight. Work on rest days has two other facets: one is where an employee works on a rest day at the request of his employer, and the other where the employee works at his own request on a rest day.

Clause 38 seeks to ensure that where an employer requires work of an employee on a rest day, he is obliged to pay an extra day's salary at the ordinary rate of pay for the day's work in addition to the ordinary rate of pay for that day, which means that an employee would receive not more than double his ordinary rate of pay.

On the other hand, there is no justification for a worker to demand double pay for work performed on a rest day if he works for his employer at his own request. We have had instances of this in the past and it is necessary that there must not be a recurrence of such undesirable practices.

It is also provided that where an employee employed by the Government or a statutory body in any of the essential services as defined under Part V of the Criminal Law (Temporary Provisions) Ordinance, 1955, works on a rest day or part of a rest day at the request of his employer, the worker shall be given a day off in substitution for such rest day.

However, the Government will be making amendments to this clause to ensure that where an employee of the Government or a statutory board is required to work for part of a rest day he shall only be entitled to a part of a day off in substitution. This provision is to ensure that work essential to the community is carried on every day of the week, but the employee does not lose his right to a weekly rest day.

It is pertinent to add in this context that the provisions of section 35 of the existing Shop Assistants Employment Ordinance requiring shops to close completely on either Friday or Sunday is not re-enacted. The basic idea underlying this provision stemmed first from the Weekly Holidays Ordinance (Cap. 156) enacted in 1950, to ensure that a shop assistant enjoyed a weekly rest day. In the circumstances, there is no reason why a provision requiring shops to close should continue to remain if the law ensures shop assistants a weekly rest day.

Clause 39 on hours of work standardises the hours of work for all classes of employees. In standardising working hours and other conditions of employment of both clerical and non-clerical workers, the discrimination that had hitherto existed between the white-collar and the blue-collar workers is eradicated once and for all.

The future of our youths is in industry and the continuance of the existing practices of discrimination would only dissuade young people from taking up jobs in industry. A prerequisite for the growth of an industrial society is respect and status for those who work with their hands as well. It is, therefore, iniquitous that those on the factory door and in the servicing industries whose creative skills are required for economic growth are given less favourable terms than those who sit in offices. The only group of employees that have enjoyed a 39-hour week hitherto has been clerks, but the provisions of clause 39 do not prevent clerical employees and other employees continuing to work a 39-hour week. However, overtime rates will become operative only after an employee, irrespective of the group he belongs, completes 44 hours in one week. There is, however, a restriction on overtime work in that an employee shall not be permitted to work for more than 48 hours in one month unless the Minister, by notification in the Gazette, declares that the relevant provisions shall not apply to employees in any particular industry or undertaking.

Mr Speaker, Sir, I am sure that hon. Members will agree that excessive overtime must be controlled, because it is a grievous anomaly and a travesty of justice that some employees should earn more than 200 per cent of their substantive pay as overtime at the expense of many of our unemployed citizens who have as much right as they to work, earn and live reasonably comfortable lives.

There is, therefore, an urgent need that the excessive benefits enjoyed by some workers from overtime earnings should be spread over a wider field to cover more persons. This is one of the clauses in the Bill which should generate greater employment.

The standardisation of conditions of employment, irrespective of whether an employee is a workman, shop assistant, clerk or industrial clerk, will now enable all to enjoy the same number of holidays in one year. Eleven holidays have been specified. Only clerks have hitherto enjoyed more than 11 holidays a year. However, all this will change and every one in Singapore, including Ministers, Parliamentary Secretaries and Government officers will have only 11 holidays in one year.

Embodied in clause 42 on this subject, however, is one significant change. Triple pay for work on public holidays will disappear. This is something unheard of even in industrialised countries. This practice cropped up in Singapore because of a High Court decision on the matter. The Bill, therefore, now provides that if an employee is required by his employer to work on any holiday, he shall be paid only an extra day's salary in addition to his ordinary rate of pay for that day.

Further, if a holiday falls on a half working day, the ordinary rate of pay payable shall be that of a full working day. This provision does away with a certain amount of confusion that has existed over the provision in the existing law about what the ordinary rate of pay should be if a holiday fell on a half working day, i.e., a Saturday. In this respect as well, there is provision that an employee employed by the Government or a statutory body in any of the essential services as defined under Part V of the Criminal Law (Temporary Provisions) Ordinance, 1955, who is required to work on any holiday or part of a holiday shall be given a day or part of a day off in substitution. The words "part of a holiday" and "part of a day off" have found their way in the clause by way of amendments that are now being moved, to meet a situation where an employee is required to work for part of a day on a holiday.

It is also provided that an employee who absents himself from work on a working day immediately preceding or immediately succeeding a holiday or any day substituted therefor without the prior consent of his employer or without reasonable excuse shall not be entitled to any holiday pay for that holiday.

Hon. Members will recall the malpractices that existed amongst certain sections of the daily-rated workers not very long ago in this regard. It is hoped that this provision will eradicate once and for all malpractices of this nature in the future. I might as well mention here, in this connection, that such a provision is not foreign to labour legislation, as in a number of other countries such a provision is more or less the general practice.

Modifications have also been introduced in respect of annual leave. Mr Speaker, Sir, hon. Members are aware that existing legislation provides 14 days paid annual leave to clerical employees and seven days to all others. The standardisation of annual leave, as embodied in clause 43, now means that all employees should enjoy the same number of days for every 12 months' continuous service with the same employer. However, the refinements that have been introduced are that where an employee has less than 10 years' service he would be entitled to seven days leave per year. But where an employee has worked for 10 years or more he would be entitled to 14 working days. These refinements favour the vast majority of workmen who, under the existing law, will only enjoy seven working days irrespective of their period of service. Clause 43 would now enable the vast majority of workers to enjoy 14 days' paid annual leave after they have completed a period of 10 years' service or more with the same employer. However, clerical employees who have not completed 10 years will stand to lose, but for those who have completed 10 years or more, the position would remain unchanged.

However, if an employee absents himself from work without permission or without reasonable excuse for more than 20 per cent of the working days in the year, he shall forfeit his entitlement to such leave.

Clause 44 introduces another change from the existing law in respect of sick leave. It provides for 14 days' sick leave if no hospitalisation is necessary and 28 days including the 14 days if hospitalisation is necessary. An employee is also required to inform his employer of his sick leave within 48 hours of his falling sick. Hon. Members will be aware of the abuses of sick leave by some workers in the past. Absence on fictitious medical certificates have been frequent because of the looseness of the provision in the existing law whereby a worker could be examined by any registered medical practitioner if the employer has not appointed one for that purpose. This looseness in the law has now been tightened up so that if the employer does not appoint a medical practitioner to examine his employee, the employee concerned will have to see a medical officer who is defined in the Bill as a medical practitioner employed by the Government.

The Government, however, will consider the amendment moved by the Member for Bukit Ho Swee for 60 days' sick leave in each year if hospitalisation is necessary, inclusive of the 14 days if no hospitalisation is necessary when this is formally moved later.

Clause 45 on the payment of retrenchment benefit is another new provision. It does not entitle an employee having less than three years' service with the same employer to retrenchment benefit. It is necessary to have such a provision in this Bill to ensure stability, particularly in new and developing industries. With emphasis on production for export markets, it may be necessary for factories to engage workers on a temporary short-term basis. It would be manifestly unfair if these new industries would have to pay retrenchment benefits to such workers once their services are no longer required.

Clause 46 provides that an employee having less than seven years' continuous service with the same employer shall not be entitled to any retirement benefit other than that payable under the Central Provident Fund Ordinance. The Government, will, however, consider the amendment to be moved by the Member for Bukit Ho Swee at a later stage to reduce the period to five years.

Clause 47 disallows the payment of I onus or any other ex-gratia payment other than as an incentive to an employee to increase his productivity or as a reward for his performance and prohibits a collective agreement from containing any provision otherwise than in accordance with this principle. This clause was made restrictive as pressures put on new and developing industries, whose profit margins will be negligible if at all, can have disastrous consequences on our industrialisation programme. It is, therefore, imperative that uninhibited demands for bonus should be curbed. The Member for Bukit Ho Swee, however, will be moving amendments to this clause. The Government will consider very carefully his arguments in this regard when he formally moves the amendments.

Clause 53 of the Bill makes an employer liable to the punishment prescribed in the Bill if he employs an employee contrary to the provisions of Part IV or fails to pay any salary in accordance with such provisions. The Member for Bukit Ho Swee has given notice that he will move an amendment to this clause. The Government has already given notice to amend clause 53.

Part IX of the Bill gives legal recognition to the Employment Exchange run by the Ministry of Labour and there is provision to enable the Minister, by notification in the Gazette, to require employers to notify vacancies to the Commissioner for Labour and to prevent employers from engaging employees except through the Employment Exchange.

Part X of the Bill on Employment of Women remains substantially similar to the provisions in the existing law, but with one exception. This exception is that the benefits are now restricted to three confinements only. It is illogical, Mr Speaker, that while, on the one hand, we are actively pursuing a policy to encourage family planning, on the other, we should through our labour laws, nullify our efforts in this direction. If our population growth is not contained, it is obvious that the measures we are taking to bring about economic growth and social well-being will be ineffective. The restriction to three confinements is, therefore, meant to discourage rather than prohibit large families. The result would be not the creation of hardships but of better and happier conditions of living.

Part XIII of the Bill includes provision for the Commissioner for Labour to collect more comprehensive manpower data.

Part XVI enables the Commissioner for Labour to inquire into and decide any dispute or claim for wages arising out of the provisions of this Act or out of any term in a contract of service, in respect of workmen and other employees whose monthly salary does not exceed $750 or in respect of employees who, before the coming into force of the Act, were entitled to lodge a complaint with the Commissioner under any of the three existing Ordinances. However, the Commissioner may not inquire into a claim involving matters arising earlier than one year from the date the claim is lodged or the termination of a contract of service of the claimant. Claims in respect of matters arising out of or as a result of the termination of a contract of service have to be lodged within six months of such termination. Provision is now made for the Commissioner to charge a nominal registration fee as provided in Schedule C of the Bill in respect of such claims.

Mr Speaker, Sir, the facts, as I have outlined so far, far from bear out the wild allegations that this Bill has sold out the rights of the workers and given them over, bound hand and foot, to the tender mercies of vengeful employers. True, it cuts into some of the fringe benefits which, as I said, only a minority of white-collar workers by and large enjoy.

On the other hand, the Bill will bring to the large majority of blue-collar workers benefits which they did not enjoy before.

However, it is not a case of the Bill withdrawing fringe benefits altogether. What the Bill seeks to do is to prevent the abuse of fringe benefits - fringe benefits being used as cover for malpractices which hamper rapid growth in productivity; which protect the inefficient and which obstruct industrial expansion and accelerated economic expansion.

The other point I would like to make is that the Employment Bill should be read in conjunction with the two other Bills I introduced today - the Industrial Relations (Amendment) Bill and the Central Provident Fund (Amendment) Bill. The first Bill reinforces management's powers to manage - powers which have been eroded over the years and without which efficient and dynamic industrial growth would be seriously hampered.

The Central Provident Fund (Amendment) Bill, on the other hand, adds to the pay packet of workers by way of extra contributions by employers to workers' savings on retirement or to make it possible for a great many workers to purchase their own home.

Those who read the Employment Bill carefully will discover that it in no way precludes workers from seeking their due and just share in expanding prosperity. But, first, there must be expanding prosperity and this cannot be brought about by dividing and sub-dividing a static level of prosperity. That is why this Bill relates rewards, not to some abstract and arbitrary principle of justice, but to more tangible and more meaningful norms like efficiency, effort, productivity and so on. Rewards whether by way of profits or wages should be related to economic growth and efficiency.

The conditions under which our labour laws and the attitudes of workers and entrepreneurs were shaped over the years no longer exist. These attitudes, if unchanged, will instead become factors for economic disaster and political anarchy in the seventies when the British withdraw. We can no longer order employee-employer relations, as we have hitherto done, in the belief that the ultimate responsibility for Singapore's economic well-being and for its military defence will rest on the shoulders of a comparatively affluent Britain. The British are scheduled to leave Singapore by 1971 and all the responsibility we can expect from them would be their good wishes and prayers for our continued prosperity and safety - perhaps a bit more if there is a change in the tide of British fortunes.

Our economic well-being and survival after 1971 is in our hands. The best we can hope for if our economy collapses would be that some kindhearted nations will send us food parcels and cast-off clothing to avert mass starvation. And in an island like Singaore where we can grow no food or plant cotton and where one square mile has to keep alive and sustain 8,000 Singaporeans, a stagnant economy means starvation.

This, I am sure, is not the future we want for ourselves or our children. This Bill, is, therefore, a deliberate and planned effort, taken well in advance, to get our people to make adjustments now to take in the economic, political and military shock of British withdrawal. Three years do not give us sufficient time but the British have decided to make a precipitate withdrawal and there is no use our trying to solve our problems by sitting down and beating our breasts in despair. Somebody has said that there are two kinds of peoples -there are the rabbits who, when cornered, die easily and there are the cats who will scratch and claw their way out.

I think we are cats and this Bill will give us the claws and the strength to fight our way out of the coming difficulties in the seventies.

It may be as well, here, to mention some of these coming difficulties besides which problems about bonus, rest days, and other alleged suffering will appear trivial when the moment of reckoning comes.

First of all, with the withdrawal of British Forces some 21,000 Singapore citizens out of some 25,500 civilians directly employed by the British will be without jobs. These 21,000 citizens are today not worrying about bonus or sick leave or holidays. Their immediate fear is that between now and 1971 they would, if we do not take stern measures now, be on indefinite holiday without pay. For 21,000 of our citizens their major preoccupation is not fringe benefits but jobs in order to exist.

Nor must we forget the additional thousands of citizens who earn a living by doing service to base civilians and British soldiers - such as domestic servants, taxi drivers, shop-keepers, restaurants and bar workers and so on.

Add to this the unemployed that now exist. According to the Sample Household Survey of 1966, they number 52,000. Add to this the 25,000 who annually enter the labour market. By 1971, therefore, for some 120,000 people - our citizens - the struggle for existence would not be debate over fringe benefits but getting a job, any kind of job just to feed, clothe and house themselves and their families. The problems and conditions of this 120,000 require our prior attention and concern rather than the relatively minor tribulations of other categories of workers.

Those trade unionists and workers lucky enough to have a job would do well to ponder over the consequences for them of massive unemployment coupled with economic stagnation. When there are thousands of workers battering at employers' doors for any job under any conditions, then the door is open for real exploitation and the progressive weakening of the authority and influence of organised trade unions and organised workers. It is, therefore, in the interests of trade unions to support, whatever the cost, measures designed to reduce unemployment by fostering sustained economic growth.

This Bill, in effect, is an attempt to tackle the problem of finding jobs for as many of this 120,000 forgotten and largely inarticulate group of citizens. I am not saying that we can solve the unemployment problem altogether. But we can contain it and minimise the tragedy and real suffering which only the unemployed can know.

Apart from the unemployment problem, we are going to lose some $450 million spent annually by the British Armed Forces in Singapore and which constitutes approximately 14 per cent of our gross domestic product. This will tail off to almost zero after 1971. To fill this gap and avoid recessionary effects to our economy, we will have to spend an additional $900 million between now and 1971.

To all these we must add the economic burden that defence will impose on us. After 1971 the centuries-old British shield (paid for and maintained by the British) will no longer be here to protect us. If we do not develop a defensive armour of our own, then a rich and strategically valuable island like ours is a tempting prize to seize - particularly if, out of a misplaced sense of thrift, we deprive ourselves of the tooth and claw to deter the freebooter.

All these might appear formidable problems - and so they are, Mr Speaker. But no problem is insoluble and in so far as our economic problem is concerned - and on which hinges our political and military viability - we may not find complete solutions. But we can with discipline, hard work and long-term planning and organisation make reasonable progress despite the many difficulties ahead. This is no idle boast. When we were asked to leave Malaysia, there were those who predicted economic disintegration and collapse for Singapore. They predicted an island seething with discontent and revolt -and a ready prey for the imitation Maos now prowling about in the caves of Victoria Street.

These predictions have been proved wrong because after separation we got down immediately to tackling the difficult economic and other problems following separation.

So once again we must start planning now to meet and overcome, this time, the economic consequences of a precipitate British withdrawal. If we are to meet the problems of unemployment, make good the $450 million the British Armed Forces have been spending, then there must be massive industrial expansions; accelerated economic growth through stimulation of our entrepot trade, tourism, shipping and so on. To do this quickly, we must attract local and foreign investments - foreign investments because we cannot mobilise enough domestic savings except by a ruthless lowering of living standards.

The Employment Bill should, therefore, be seen in the context of the new problems an independent Singapore faces. There must be a climate of industrial peace and stability to attract both local and foreign capital. It is essential to increase the productivity of our workers, the efficiency of entrepreneurs, so that our products can compete in the stiff competitive export markets of the world.

This is the intent and purpose behind this Bill. How far this Bill will succeed in its purpose will depend on both workers and employers placing national interests before sectional interests.

The Government is aware, too, that like some workers there will be some short-sighted and stupid employers who will try to take advantage of this Bill, not to promote economic expansion, but unjustly to squeeze workers for personal gain. I know that one or two such employers have already, through a selfish misreading of the Bill, started wielding the big stick. They have proposed cuts and reductions, not because of financial difficulties, but because the proprietors want to get a bit more spending money for themselves.

May I inform such employers that the Government will not stand idly by and watch them sabotage our efforts to bring about industrial peace and stability. They are not the only ones who can wield the big stick -and their stick could, when it comes to the crunch, be broken like a rotten twig.

Of course, the Bill does not provide for all situations, for all sorts of contingencies that may arise in what is a rapidly changing area of the world. So the Government will in the light of experience review the Bill when defects come to the surface.

So, Mr Speaker, unless this Bill is studied in the context of our formidable economic and political problems, its essential purpose and objectives might well be lost sight of in the debate. These formidable problems cannot be tackled without painful adjustments though the Government has made every effort to reduce to a minimum the pain by sweetening the medicine somewhat,

In conclusion, let me say that this Bill, with the amendments, still remains the most progressive piece of labour legislation in this part of the world. There is as yet no country in this region which provides (together with the proposed amendments to our Central Provident Fund laws) benefits and terms better than what the workers of Singapore will enjoy.

Sir, I beg to move.

Question proposed.

4.28 p.m.

Mr Hwang Soo Jin (Jalan Kayu): Mr Speaker, Sir, as you will recall, one of the most popular slogans in Britain in the late fifties was: "You have never had it so good!". It is perhaps not inappropriate to apply this to Singapore today. We boast of the highest per capita income in the region. We have a strong currency and our balance of payments is extremely healthy. In short, we are going through a period of prosperity. Perhaps some people may be wondering, what have we to worry about? Indeed, if we are and can afford to be complacent, we have nothing to worry about, at least for the time being. However, we are no longer a subjugated people who have no control over our own destiny, nor are we a soft-headed people who are incapable of planning or anticipating events beyond tomorrow. We are committed to building a nation of our own which we are determined should last not for the present generation alone but for generations to come. As such, we must constantly look forward and plan ahead making the necessary material sacrifices and re-adjustment in our mental attitudes from time to time so as to ensure that our children and grandchildren will enjoy, if not a higher standard of living, at least a standard equal to our own. As responsible citizens and parents, I am sure that this is one commitment we are not afraid of and should have no hesitation in entering into. Sir, it is in this context that I feel that the Employment Bill should be considered.

[Mr Yeoh Ghim Seng temporarily in the Chair]

4.30 p.m.

Mr Hwang Soo Jin (Jalan Kayu): The choice before us is the choice between temporary higher income and long-range economic security. With the projected withdrawal of the British Forces and the constant population pressure upon our very limited natural resources, as I see it, our economic security is being seriously threatened, and unless something is done about it within the short time available to us, between now and 1971, I am doubtful that we would be able to maintain the high per capita income. The direction and the manner in which we are to counter the anticipated recession have been made abundantly clear by the Prime Minister, the Minister for Finance, and the Minister for Foreign Affairs and Minister for Labour on more than one occasion and I would not, therefore, elaborate. Suffice it to say here that for our national survival and economic well-being, the emphasis for the years ahead of us lies in raising the economic productivity of our people. It is only through a reputation for high productivity that we can hope to attract more foreign investors to participate in our industrial programme. It is only through higher productivity that we can hope for our existing industrial concerns to secure a fair share of the fiercely competitive world market. But so long as anomalies are allowed to exist in the area of industrial relations, it will be difficult for productivity to be raised beyond a mediocre standard. With the passage of the Bill, some of the anomalies that have arisen during the past years will be regularised. This, I feel sure, will in time help to put us on a stronger footing both in the race to attract more investors and in the fiercely competitive world market.

However, in perusing the Bill, I do feel that whilst certain disciplines and sacrifices are required of our workers, they should not be left without safeguards entirely in certain areas, bearing in mind that not all managements are enlightened, and not all managements are conscious of their social responsibility and are capable of identifying their long-term interests with those of the people and the State. There are bound to be some who will see in the Bill a long-awaited opportunity to exploit the employees for their immediate gain. In this connection, I feel that the provision for the payment of bonus as contained in the proposed legislation does call for amendment.

In conclusion, Sir, I am pleased to note that the Central Provident Fund Ordinance will be amended to permit members of the Fund to utilise the amounts standing to their credit in the Fund for the purchase of houses or flats for their own occupation. It appears, therefore, to me that whatever the employees may lose on the swings, they will gain on the roundabouts.

4.34 p.m.

Mr Sia Khoon Seong (Moulmein): Sir, I rise to make certain observations on the Employment Bill.

There will be difficult years ahead and the problems confronting Singapore are immense and call for drastic solutions. If, in the course of the next few years, Singapore does not make substantial and radical changes to her social and economic infrastructure, the present unemployment problem will grow to grotesque and unmanageable proportions, the consequences of which will be painful and disastrous for all persons who make Singapore their home.

The trade union movement of Singapore is not blind and deaf to these wider problems of the Republic. Trade union members are fully aware that as citizens and permanent residents of Singapore they have their obligations to their fellow citizens, and that their fate is interwoven with the survival of Singapore as a political and economic entity. Any step taken by the Government as an emergency measure to meet the challenge posed by the difficult and crucial years ahead will have the co-operation and support of the trade union movement if it is convinced that such step will eventually help the Republic to survive as a political and economic entity and to bring progress and economic advancement to its two million citizens.

The Employment Bill should be viewed in its proper perspective as one of the measures introduced by the Government to bring about a more favourable climate to attract massive foreign investment into the Republic in order to cushion off the expected economic impact of the complete British withdrawal by 1971, and to bring about an increasing number of job opportunities to overcome the growing unemployment problem.

Much as we in the trade union movement dislike the changes to be introduced into the labour legislation by the Employment Bill, we have to accept such changes as necessary and inevitable in the light of Singapore's economic circumstances. But it should be made emphatically clear that our acceptance of the underlying principles of the Bill does not mean that we unreservedly accept the manner in which such principles are translated into the actual provisions of the Bill. We do not expect the unpleasant policies of the Government as embodied in the Bill to be sugar-coated for our easier acceptance but, at the same time, we do not expect the Bill to be made unnecessarily bitter.

The Employment Bill, as it stands, has certain deficiencies. It is feared that unscrupulous employers will take advantage of these deficiencies to cause unnecessary hardships and difficulties to the workers. It is our fear that once this Bill is passed as it stands it may run contrary to the desired objective of the Bill and, instead of giving solutions to our problems, would create additional problems such as widespread industrial unrest. While we may not have serious objections to prospective investors, particularly foreign investors, who seek to commit millions of dollars to new enterprises in the Republic, wishing to be assured of trouble-free labour relations and of the absence of any possibility of unnecessary prohibitive labour costs making their products uncompetitive in international markets, we must confess that we find it extremely alarming and disturbing that there are employers, particularly our citizen employers, in well-established firms and small business concerns who are thinking of taking advantage of the Employment Bill and treating it as a licence to exploit labour.

[Mr Speaker in the Chair]

4.38 p.m.

Mr Sia Khoon Seong (Moulmein): Mr Speaker, Sir, in brief, this is the main consideration for the N.T.U.C.'s decision to propose amendments to the Employment Bill through the Member for Bukit Ho Swee, who is the Secretary-General of the N.T.U.C.

Let me now, in a general way, point out the objections of the trade union movement to clauses 15, 43, 44, 46 and 53 of the Employment Bill which we think will not help in any way as it stands at present to give effect to the Government's objectives in introducing the Bill.

Let me first take clause 15. It seeks to restrict the employment of persons after the age 55 years. It is true that clause 15 provides for approval by the Commissioner for Labour of the employment of persons after the age of 55 years. But does the Government really believe that many employers, even if they do not use the provision as a pretext of getting rid of long-service employees with their relatively higher wages, will bother entangling themselves with the unnecessary red tape of getting such approval? Such a provision, if allowed to stand, would in effect condemn a substantial number of workers, leading a hand-to-mouth existence with family obligations and without any life savings, to great hardships and perhaps, figuratively speaking, to a lingering death by starvation.

I am sure that such horrible consequences cannot be the purpose of the Bill. Why then is clause 15 included in it? Is it to compel an employee to retire at the age of 55 so that he has to make way for a younger unemployed citizen? It may not have occurred to the Government that, in forcing employees at the age of 55 to retire for the purpose presumably of making way for a corresponding number of young unemployed citizens, it may not achieve the desired effect of reducing the extent of unemployment, because the young unemployed citizens are not likely to possess the skills and experience of those forced to retire at 55 years. What will, in effect, be the result is that a different category of citizens will become unemployed, mainly those reaching the age of 55 in addition to the existing number of unemployed citizens.

Mr Speaker, Sir, may I ask, is this not unnecessarily cruel? It is indeed pitiful that young citizens are unemployed, but they are usually without dependants and can perhaps scrape an existence from parents and relatives for a reasonable length of time. On the other hand, the old citizens are rendered unemployed because they have reached the age of 55. Those who are strong and able to work can perhaps make a significant and useful contribution to our national development. Moreover, they are likely to have dependants whose well-being and survival depend on their livelihood. What is this magic figure "55" that will determine that men will no longer become useful to society and must wither away from the scene of active life? Does it make sense to say that amongst us in this House the two most senior Cabinet Ministers in terms of age, namely, the Minister for Foreign Affairs and Minister for Labour and the Minister for Defence, when they reach the age of 55 in a few years, will become decrepit and must leave their portfolios to younger men? Judging from the healthy disposition of these two gentlemen and their mental agility, I would like to believe that they will be more than fit, both physically and mentally, to be with us in this House long after they reach the age of 55. With the passing of time, they will grow in wisdom, and with their additional years of valuable experience they will remain to help chart the course of the Republic's progress and destiny.

In fact, we in the trade union movement look forward to many, many years of happy confrontation with the Minister for Labour over the labour problems that may arise when the Employment Bill and other new labour legislation come into force. It is not in the Republic's interest if men with skill and experience, just because they reach the age of 55, must retire when at this juncture of our national development we are looking towards our workers acquiring more skills and ability in order to make a success of our economic expansion.

Clause 44 has been ostensibly worded to minimise abuses to the provision of sick leave by irresponsible workers. But it should be made clear to this House that any attempt to paint a picture of prevailing widespread practice among workers who use the sick leave provision as a means of getting extra paid leave is largely un-warranted. The small percentage of black-sheep amongst workers who behave irresponsibly in this manner must be viewed in the correct perspective of the large percentage of workers who are proud of their record of seldom being on sick leave. In any event, the restriction of sick leave without hospitalisation to a maximum of 14 days a year should satisfy any employer with an obsession that his employees on sick leave are not very sick. But we are of the view that 28 days a year is insufficient to provide for the hospitalisation of an employee. I am of the view that the maximum period for hospitalisation should be increased from 28 days to 60 days at least. Our consideration is that the stringent requirements for an employee to be granted sick leave for the purpose of hospitalisation leave no scope for any possible abuse and, secondly, medical science and technology have not advanced to a stage where an employee can be immune from being incapacitated for one or two months by a serious illness.

Clause 46 of the Bill states that the qualifying period in respect of an employee's entitlement to any retirement benefit payable by his employee is seven years of continuous service with that employer. I share the view that the period should be reduced from seven to five years on the grounds that most collective agreements have provided that an employee is eligible for retirement benefit after five years of service. To extend such qualifying period is to impose unnecessary hardship on the workers who, unlike their counterparts in the civil service, do not have a pension to look forward to on their retirement. The retirement benefit, which is an ex-gratia payment for past services, serves as enforced savings for an employee's retirement.

Clause 47 of the Bill makes bonus a non-negotiable issue between an employer and a trade union, and relates the payment of bonus to the productivity of performance of the workers. The weakness of such a provision is that it is not only impracticable but also unrealistic. It takes for granted, as proved to be true and correct, several propositions the soundness of which is highly questionable. One proposition is that an employer would not cut off his own nose to spite his own face by refusing to give incentive payments to his workers. Our experience is that some employers would go to extraordinary lengths to avoid giving workers their just dues. Another proposition is that productivity and profits can be easily and conveniently measured or determined. Our understanding is that these two subjects form areas of much controversy. I share the view, therefore, that bonus should be made a negotiable issue up to a maximum of one month's salary of an employee and that any bonus over the amount of one month's salary is to be payable at the discretion of an employer on the basis of incentive or a reward for the employee. By allowing bonus to be negotiated on the present basis between the employer and a trade union subject to the maximum of one month's salary, the necessity and difficulty of determining what is productivity and what are profits are obviated. This will help to minimise industrial friction arising out of the question of bonus.

Clause 53 of the Bill re-enacts the existing provisions in the Clerks Employment Ordinance, the Labour Ordinance and the Shop Assistants Employment Ordinance. As the provisions of clause 53 now stand, there is some confusion as to the effect of this clause. The confusion arises mainly out of a misinterpretation of Government statements on the Bill to the effect that the provisions of the Employment Bill are intended to place a maximum limit on the terms and conditions of service of workers in Singapore. This is shown to be erroneous when the Bill was read for the First time. Nevertheless, such misunderstanding may persist and some employers may use it as a pretext for not giving to their employees more favourable terms and conditions of service in relation to the Employment Bill. We have accordingly sought to clarify these provisions so that it would not be an offence to grant more favourable terms and conditions of service.

These, in brief, Mr Speaker, Sir, are some of the grounds for our proposed amendments to the Bill. My trade union colleagues in this House will be addressing you more fully on this subject.

Before I conclude, I would like to mention in passing that all sections of the public service have helped to make Singapore what it is today, and no doubt they will play a vital and significant role in the difficult years ahead. They have grievances over conditions of service and salary structures in the public service, and these have been referred to the Salaries Commission which has considered them and has submitted its report to the Government. I hope the Government will table the report before this Parliament as soon as possible.

4.53 p.m.

Mr Tay Boon Too (Paya Lebar): (In Mandarin): Mr Speaker, Sir, there is no doubt that at the present stage of nation building in Singapore we must put special emphasis on the development of our economy in order to meet the expenditure on defence, social, and educational requirements. We do not have natural resources such as tin and rubber. We have to depend only on ourselves as a trading centre, and to develop our industries in order to support our economic livelihood. Of course, we have about a century of history and experience as a trading centre to sustain us. But in regard to industrialisation we are making only a beginning. We are making great efforts to industrialise. This task is very important to our economic productivity and viability. Industrialisation must be a viable and living force in order to enable our country to achieve greater economic expansion and increase our gross national product and financial resources. By producing more revenue, more employment opportunities would be created for our workers. This is a very ambitious task.

We must, first and foremost, become an advanced industrialised society in this region. To achieve this objective, we must, besides attracting foreign capital, give due regard to our products which must be low in price, good in quality and modern in design so as to compete with other countries. Unless we accomplish this, we cannot compete with products of other countries in the international market, and our attempt to make Singapore an industrial society will fail.

The people of Singapore will not relax in their efforts nor will they shirk their responsibility for the development and growth of our national economy. In the past few years they have been able to check and overcome unfavourable conditions. They have accepted and supported the economic policy of the People's Action Party since it came into office.

In the field of industrial relations, we have done away with strikes and have curbed disturbances and outbreaks of violence which characterised the 1 950s. Industrial disputes have become things of the past. We are now enjoying good weather after the storms and turbulence of the past few years. We must publicise the fact to foreign industrialists that conditions here are stable, that our society is a peaceful one and that our workers are enlightened. They will then be willing to extend their operations to our country. They will be willing to invest in and expand our industries. I fully understand the importance of large capital investment and economic development in this country, because these factors will create more employment opportunities for our growing population.

It is because of some of the points which I have enumerated that our Government has now formulated a sound long-term policy by introducing the Employment Bill. I support and welcome this Bill in principle. But there are some provisions in it which are unnecessary, impractical and harsh. In spite of the Minister's detailed explanation of the purposes of some of the provisions, I am still not satisfied. I regard them as stringent, and many people share my view. We must therefore advance our views for his consideration. I have said just now that I accept this Bill in principle. But because of the risk that some of the provisions may be abused by some employers, thereby distorting the original purpose of the Bill, I must air my views and criticisms.

Let me now enumerate some of the provisions which I regard as unsuitable. The Member for Moulmein has also touched on them. But his views may not be entirely the same as what I am going to express on behalf of the people of my constituency.

Sir, in the past as well as at present, business organisations and enterprises regard the payment of bonus as a means to encourage workers to be more diligent in their work. It has become an incentive for increased productivity and this has achieved good results. We all know that bonus is not merely an incentive to the workers but that employers also earn more profits as a result of the diligence and increased productivity of the workers. Because of this, the workers are entitled to a small percentage of the profits. This is only reasonable and justifiable. Moreover, in the past few years, employers have never grumbled about paying a bonus to their employees. This is an undeniable fact. So it is rather strange that the Government, as a third party, should now step in and take the initiative of introducing a provision to abolish the payment of bonus and giving employers absolute discretion in this connection. This will lead to a situation where the payment of bonus to the workers will depend entirely on the employer. It is like receiving charity from him. Of course, when I give these views, I do not mean to encourage irresponsible unions to abuse the bonus issue and create industrial strife over it. But my point is that we should not have a rigid law to abolish the payment of bonus.

There is only a very brief provision in the Bill regarding bonus. It says that the payment of a bonus to a worker should be an incentive to increase productivity or as a reward for good performance. This provision negates all past awards on the payment of bonus and has entirely abolished the provision for bonus in the collective agreements reached. Thus it will lead to a situation where thousands of employees will have no alternative but to request for salary increases in order to incorporate the bonus that they have lost into their salary scales. Only thus, can they remedy the loss of a bonus. Without such a remedy, the industrial peace and stability which we are enjoying now will be difficult to maintain.

Sir, if we are dazzled by the term "bonus", we may change it to the term "rate of distribution of profits". If an enterprise or a company has made a profit, the workers and the employer can share this profit according to a specified rate of distribution. They should share it at a set rate. I think this is the best means to increase productivity.

Next, I would like to deal with retrenchment benefits. This provision is a great boon to employers. Of course, we must stop the small group of workers who abuse such benefits, for example, by deliberately carrying out a work-to-rule policy or by indulging in absenteeism or by disobeying the orders of the management with the purpose of provoking the employers into sacking them so as to benefit from such a provision. But I must say that I cannot support the drastic change proposed by this provision. Those with a service of less than two years are not entitled to retrenchment benefits according to the provision in the Bill. Such a grave problem which involves the worker and his family is glossed over by the Bill. This will offer a very good opportunity to an employer to misuse this provision and to fire his employees without taking into consideration whether his business is making money or is running at a loss, and without taking into consideration whether such retrenchment arises from the need to reorganise his business. Moreover, nepotism is very prevalent in the Chinese community. Some employers tend to fill positions in their organisations with their relatives. Therefore, the workers are placed in a very precarious position. Hence, I would like the Minister carefully to reconsider this provision and make necessary amendments to it so as to make it better and more effective.

Next, I would like to touch on the provision of compulsory retirement of employees at the age of 55. The Minister has promised to review this provision, so that a worker's retirement will depend on his capability to work and not on his age. Such a move is very encouraging. We must not forget that our Government is now propounding a social philosophy which puts a premium on a rugged and strong society. What is the significance of this philosophy? We can say with certainty that what we strive for is a healthy body. Moreover, our medical and health services, although they cannot be regarded as among the foremost in the world, are, we can safely say, second to none in Southeast Asia. With such excellent medical and health services, the average life span of our people is longer than that of any other country in Southeast Asia. The average life span here is 63 years. If we make it an inflexible law that a worker should retire at the age of 55, and if we take $200 per month as the average income of our people, then the total income earned in a working life of from 20 years to 55 years will be $84,000. If this amount is spread out over a period of 43 years as household expenditure, it will work out to $162.80 per month. Thus, if this provision is put into effect, our living standard will be reduced by one-fifth.

5.15 p.m.

Mr Speaker: Order. We have reached the moment of interruption pursuant to the earlier resolution of this House. The debate on this Bill will be resumed tomorrow afternoon. Mr Rajaratnam, will you please move the adjournment?