BANKER'S GUARANTEE FOR FOREIGN WORKERS

Mr Chia Shi Teck asked the Minister for Labour whether the banker's guarantee required to be furnished for foreign workers brought in by companies for approved training purpose will be modified as the present requirement of $5,000 per person matched to each name is both costly and cumbersome, as well as a financial strain on the smaller local companies.

Dr Lee Boon Yang: Employers need to obtain Work Permits and Visit Passes for their foreign trainees before they can work and stay in Singapore. The requirement that employers must furnish security bonds for their non-Malaysian foreign trainees before they are allowed to enter Singapore is a condition for the granting of Visit Pass. The issue of Visit Pass and the acceptance of security bond are both under the ambit of the Immigration Act. The Ministry of Labour currently performs these functions on behalf of the Ministry of Home Affairs to provide one-stop service to employers.

The security bond serves a deterrent purpose to ensure that every employer repatriates his non-Malaysian foreign trainee after the Visit Pass is cancelled. The Controller of Immigration requires the name of the foreign trainee to be stated in the security bond because the bond is tied to a Visit Pass issued to a particular foreign trainee. The bond will be discharged once the particular foreign trainee is repatriated.

Employers can furnish the security bonds in the form of bankers' guarantee, insurance guarantee or cash. To reduce cost, employers can compare the service offered by different financial institutions and choose the most economical option.