EMPLOYMENT OF PART-TIME FEMALE WORKERS (Incentives)

Mr Chia Shi Teck asked the Minister for Labour (a) whether more incentives will be introduced to attract females who cannot go into full-time employment to work part-time and (b) whether a lower employee Central Provident Fund contribution rate will be introduced for part-time workers so as to allow them a higher take-home pay whilst maintaining the 20% contribution from the employer.

The Minister for Labour (Dr Lee Boon Yang): Mr Speaker, Sir, success in attracting the economically inactive females to join the part-time workforce depends on many factors. These include the benefits offered by the employers and the scheduling of part-time work for the convenience of housewives.

My Ministry will ensure that our labour laws do not stifle the employment of part-time workers. In August 1990, the Ministry introduced a set of guidelines to help facilitate part-time employment. The Guidelines on Part-Time Employment were drawn up based on tripartite consultation and consensus. Under the Guidelines, statutory benefits are pro-rated based on the part-timer's contractual working hours in a year vis-a-vis that of a full-timer. Employers are also given the flexibility to encash certain benefits such as annual leave and public holiday entitlement for the part-time workers. The Ministry is conducting a review to formalise these guidelines into Employment Regulations so that the rights and obligations of the employers and part-timers are more clearly spelt out.

With the Regulations in place to facilitate part-time employment, employers should come up with innovative schemes to meet the convenience of housewives so that more would come forward to work part-time. This would also help to alleviate our manpower shortage and reduce our reliance on foreign workers.

On the Member's question of reducing the CPF contribution rate for part-time workers, my Ministry is not in favour of this. This is because CPF contribution is not the sole factor influencing the attractiveness of part-time employment. Reducing CPF contribution may not result in a larger number of people engaging in part-time work. On the other hand, any reduction in CPF contribution rates for part-time workers will affect some 47,000 part-time workers who are currently making full CPF contributions. Part-time workers also need to save for retirement and Medisave as much as full-time workers. The CPF scheme, as it is presently structured, helps them to do so. To lower CPF rate for part-time workers will create anomalies. A person working part-time but earning more may end up paying less CPF than another person working full-time but earning less.

Finally, reducing the CPF contribution rate, even if it is the employee's contribution rate, may lead some employers to take into account the lower CPF contribution rate, hence, higher take-home pay, and therefore offering a lower basic wage to the part-time worker. The part-time worker may still not end up with a higher take-home pay.

Mr Chia Shi Teck (Nominated Member): Sir, there are many categories of part-time workers. One category could be those who are engaged full-time and choose to work part-time over the weekends as cashiers or as service personnel in hotels. They already have CPF contribution in their full-time jobs. So for such work, does the Minister think there is a need for them to have the employee's CPF contribution, because they already have the CPF contribution?

Dr Lee Boon Yang: Mr Speaker, Sir, in fact, my colleague, the Minister for Health, just explained a moment ago the principle behind CPF contribution. If you are working in several jobs, you will contribute according to the full CPF rate for all the jobs. But if the sums add up to more than the maximum required for CPF contribution, that is, $6,000 a month, then you can ask to have the contribution capped at this maximum of $6,000 a month. So this principle applies, whether it is full-time employment plus part-time employment, or a person working in many different jobs on part-time basis.