EMPLOYMENT ACT (Raising of wage ceiling)

Mr Cheong Yuen Chee asked the Minister for Labour, in view of the substan- tial rise in wage level arising out of the accumulated NWC wage increases in the past few years, whether he will consider raising the present wage ceiling of $750 p.m. to a higher ceiling for workers covered by the Employment Act.

The Minister for Labour (Mr Ong Pang Boon): Mr Speaker, Sir, I am pleased to inform the hon. Member for Toa Payoh that the $750 per month wage ceiling laid down in Sections 33, 35 and 144 of the Employment Act will be raised with effect from 1st December, 1980, to $1,250 p.m. in view of the substantial increase in the level of wages since the ceiling was fixed 12 years ago.

Hon. Members may wish to know that section 35 of the Employment Act stipulates that Part IV of the Act applies to non-manual employees whose salaries are not more than $750 p.m. However, Part IV applies also to manual employees irrespective of the amount of their monthly salaries. Part IV lays down conditions of service like rest days, holidays, hours of work and payment for overtime work. On the other hand, section 33 provides that where the property of an employer is sold, or any money due to such employer is garnished on the application of a person holding a mortgage, charge or lien or of a person who has obtained a judgment or decree, the court ordering the sale or garnishment shall not distribute the proceeds of such sale or such money unless the salaries due to all employees of the employer have been paid. In the case of section 144, it empowers the Commissioner for Labour to enquire into and decide on any dispute between an employee and his employer relating to matters arising out of any term in the contract of service or any provision of the Act.

The wage ceiling of $750 p.m. was fixed in 1968. Since then the level of wages has increased substantially. The median monthly income of all employees, according to CPF records, rose by 138%, from $175 in 1968 to $416 in June 1980. In terms of occupational groupings, the median monthly earnings of sales and service workers based on the Singapore Sample Household Survey, 1966, and the Labour Force Survey, 1979, increased by about 94% and 88% respectively between 1966 and 1979.

Following consultations with the National Trades Union Congress and the Singapore National Employers' Federation, the Government has decided that with effect from 1st December, 1980, the wage ceiling in sections 33, 35 and 144 of the Employment Act be raised to $1,250 p.m. The wage ceiling will in future be adjusted at regular intervals to take into account rises in the level of wages.