EMPLOYMENT OF FOREIGN WORKERS (AMENDMENT) BILL

Order for Second Reading read.

The Minister for Labour (Dr Lee Boon Yang): Mr Speaker, Sir, I beg to move, "That the Bill be now read a Second time."

The Minister for Home Affairs has just explained to this House the problem caused by illegal immigrants and overstayers. These immigration offenders come to Singapore to work illegally. Hence, my Ministry has also encountered an increasing incidence of illegal workers.

Sir, the number of foreign workers working illegally in Singapore has been on the rise. In 1994, an average of 31 employers per month had been prosecuted for employing illegal foreign workers. This rose to 41 per month in the first nine months of 1995. Because of the difficulty of catching employers of illegal workers, such prosecutions may well be the tip of the iceberg.

Another indication of the extent of this problem is the large number of complaints to my Ministry about the presence of illegal workers. In 1993, there were 291 complaints per month. This rose to 372 complaints per month in 1994 and 370 per month for the first nine months of this year. Owing to various constraints, we could only investigate some of these feedback. Not every complaint could be investigated thoroughly. What is alarming is that in most cases that we investigated, the complaints were found to be valid and illegal workers were indeed apprehended in follow-up actions.

The presence of a large number of illegal foreign workers is a cause of concern. The main implication of having a large number of illegal foreign workers is that they are bypassing our controls which are put in place to regulate the social and economic impact of a large foreign workforce. We already have more than 300,000 work permit holders in Singapore. If we do not curb the practice of employing illegal workers, it will make a mockery of our attempts to regulate the entry of foreign workers. The presence of large numbers of illegal workers will hinder our efforts to encourage employers to upgrade their business operations and to reduce dependence on low cost foreign workers. Illegal workers also depress the wages of our Singaporean workers who have lower skills, or are lower-educated, and who have difficulties working at the wages which are welcomed by illegal workers.

The Minister for Home Affairs has just pointed out that Police is concerned about the increasing incidence of crimes committed by foreigners and these crimes range from simple theft and robbery to more serious offences, such as hurt and even murders. Sir, the number of foreigners arrested for committing crime in Singapore has risen from 1,443 in 1993 to 1,879 in 1994. And in the first nine months of this year, 1,591 foreigners had already been arrested. Having an unknown number of unidentified illegal workers in our midst will certainly aggravate this dangerous trend.

Sir, there is clearly a need to take more drastic action to deter the employment of illegal workers. So far, my Ministry has taken two specific measures. One, urging the court to impose deterrent sentences on employers of illegal foreign workers; and, two, pressing for custodial sentences for first-time offenders who blatantly abuse the Employment of Foreign Workers Act.

Nonetheless, our enforcement action is still hampered by existing inadequacies in the Employment of Foreign Workers Act. The amendments to the Employment of Foreign Workers Act are targeted at removing these inadequacies. The key amendment is to deal with the rampant problem of illegal employment at construction sites. Members may be interested to know that, on average, 37 illegal workers were detected at each construction site which the Ministry of Labour raided this year.

The problem of illegal employment is most serious in the construction sector because the existing provisions in the Employment of Foreign Workers Act are unable to deal effectively with contractors who hire illegal foreign workers. The unique feature of the construction sector is the existence of a multi-layered sub-contracting system. Because of the presence of a large number of sub-contractors at a particular worksite, when an illegal worker is found, it is quite difficult to pinpoint who exactly is his real employer. In many instances, nobody can be held liable if the employer of the illegal worker is not positively identified. And the Minister for Home Affairs explained how, in some cases, despite the fact that we have raided, arrested and found evidence that the foreign workers have been working illegally, we could not prosecute the person concerned because the illegal worker did not cooperate and would not identify who were his employers. Such ambiguity hampers our investigation and provides a loophole for unscrupulous contractors to evade the law.

Sir, the frequent deployment of construction workers from one site to another by their employers or by their contractors makes monitoring and detection of illegal employment even more difficult. And furthermore, the working environment at construction sites is conducive for employment of illegal foreign workers. Main contractors may not institute proper site management system, thus making it easy for illegal workers to enter the worksite and to remain there.

Some contractors gave the excuse that they had to resort to illegal workers because they could not qualify for work permits as our Work Permit Allocation policy is too stringent. The Ministry of Labour's data, however, show that this is not true. At present, more than 90% of the construction companies are operating within the 1:5 dependency ratio. In fact, more than 70% are operating within the 1:3 ratio. This shows that most contractors could employ additional foreign workers legally, if they need to.

Our investigations show that unscrupulous contractors had, in fact, deliberately chosen to employ illegal foreign workers because they wanted to evade the levy. Of the 89 contractors who were caught with illegal workers in the first nine months of this year, 84 could have employed additional work permit holders under the 1:5 dependency ratio. In fact, 66 of those contractors did not even apply for any work permit at all for any of their foreign workers. We can only conclude that these contractors resorted to illegal workers not because they were unsuccessful in applying for work permits but because they were out to cheat the Foreign Workers' Levy system. As a result, we were compelled to seek deterrent prison sentence on contractors who had blatantly abused the Employment of Foreign Workers Act. Two recent cases concern a contractor charged for employing 64 illegal foreign workers on 28th July 1995 and another contractor charged for employing 18 illegal foreign workers on 17th October 1995.

In these cases, what is noteworthy is that both contractors had never applied for work permits for their foreign workers. Both contractors were handed prison sentences by the Court despite the fact that it was their first conviction.

Sir, contractors will be granted work permits within the current dependency ratio and so long as they have construction projects at hand which justify the need for foreign workers. When we raised the dependency ratio for the construction sector from 1:3 to 1:5 in November 1992, the volume of construction activity was at its peak with the value of contracts awarded at $12.8 billion. Construction activity subsequently tapered off, with the value of contracts awarded at $10.6 billion in 1993 and $12.1 billion in 1994. Hence, there is little ground for contractors to complain that the 1:5 dependency ratio is currently insufficient to meet their needs as demand for construction workers should not be much higher than in 1992.

Sir, to ensure that the problem of illegal employment in the construction sector does not get out of hand, it is necessary to amend the Employment of Foreign Workers Act to hold principal contractors responsible for illegal foreign workers found at their worksites. This will compel principal contractors to put in place proper worksite security measures and to exercise greater controls over their sub-contractors who very often are the culprits behind the illegal foreign workers. My Ministry's officers had also briefed representatives of the Singapore Contractors' Association Ltd in September 1995. SCAL had accepted the reasons for tightening the Employment of Foreign Workers Act and was supportive of the general approach.

Besides the section on principal contractors, the Bill also contains other amendments which are introduced to facilitate investigation and prosecution work.

I will now highlight the key provisions of the Bill. Currently, employers of illegal foreign workers are able to evade prosecution by claiming that they did not know that the illegal workers were foreigners. Clause 3 of the Bill is intended to plug this loophole. It introduces new sections 5(3A) and 5(3B) which place the onus on employers to ascertain the nationality of their workers. If employers claim that they did not know that the illegal workers were foreigners, they will have to prove that they have exercised due diligence to check the passports, documents of identity or other travel documents of the workers.

Again, under the existing Employment of Foreign Workers Act, the penalty for an employer who is convicted for illegal employment for the second or subsequent offence is a mandatory custodial sentence of one to 12 months, and a fine of two to four years' levy. However, the custodial sentence cannot be applied on a body corporate, such as a company. Hence, in clause 3, we have introduced a higher fine equivalent to four to eight years' levy for a body corporate which is convicted for the second or subsequent offence.

Clause 3 of the Bill also introduces a definition for the word "employ". The new section 5(9) defines "employ" as "to engage or use the service of any person, whether under a contract of service or otherwise, with or without salary." This new definition is necessary and is adopted so that it will no longer be possible for errant employers to claim that they did not "employ" the illegal foreign workers because "they did not pay the workers any salary" or that "they were merely trying out the workers".

Under section 6 of the existing Employment of Foreign Workers Act, an illegal foreign worker must be "found" working or "found" in possession of any tool or implement before the prosecution can invoke the presumption that he is employed by the occupier of the premises. This poses difficulties as there are instances where the illegal foreign worker is not working at the time of the inspection, such as during a raid conducted at night at the worksite, as described by the Minister for Home Affairs. Under such circumstances, although it is obvious that the foreigner has been working at the premises, the presumption clause cannot be invoked because he was not found working at the time of the raid. To overcome this problem, clause 4 of the Bill seeks to repeal the existing section 6 and to replace it with a new section 6 which will enable the prosecution to invoke the presumption that the occupier employed the foreigner so long as the foreigner is found at the premises.

Let me point out that this is a rebuttable presumption. If investigations show that the foreigner found at the premises was not working or had never worked in the premises, the occupier will not be prosecuted. Even if the foreigner was working, the occupier need not be held liable if investigations show that another person is the actual employer of that foreigner.

I now come to the amendment to hold principal contractors responsible for illegal foreign workers found at their work place. The purpose is to compel principal contractors to set up worksite security measures to prevent easy access to illegal workers. This is not unlike the new measures required under the Immigration (Amendment) Bill approved by the House earlier.

Clause 4 of this Bill introduces a new section 6A which makes it an offence for a principal contractor who has control of access to his work place to permit any foreigner without a valid work permit to enter or remain at his work place. If such a foreigner is found at the work place, the principal contractor is presumed to:

(a) have control of access to the work place;

(b) have permitted the foreigner to enter or remain at the work place; and

(c) have knowledge that the foreigner does not possess a valid work permit.

This presumption will be applied to principal contractors who clearly would have the opportunity to exercise control of access to the work place. In addition, principal contractors can rebut the presumption by proving that they have exercised due diligence:

(a) to prevent the foreigner from entering or remaining at the work place; or

(b) to ascertain the nationality and work permit status of the person.

To show that they have exercised due diligence, principal contractors must demonstrate effective security measures at the worksite which will prevent entry of illegal foreign workers. A Notification prescribing such security measures will be gazetted. The security measures required will be similar to that recommended by the Police to deal with the presence of immigration offenders at worksites and will include:

(a) erecting perimeter fence around the worksite;

(b) deploying security guards at all entrances and exits of the worksite;

(c) issuing identification passes to all persons entering and leaving the worksite; and

(d) maintaining proper records of all persons entering and leaving the worksite.

Sir, the penalty for a principal contractor who contravenes this section is a fine of two to four years' levy, or imprisonment up to one year, or both for the first offence. The penalty is doubled for the second or subsequent conviction to a fine of four to eight years' levy, or imprisonment for up to two years, or both. The penalties are comparable to those for employers of illegal foreign workers, except that there is no mandatory custodial sentence for principal contractors who are convicted for the second or subsequent offence.

I would also like to take this opportunity to point out that under clause 4, the new section 6A(7) empowers the Minister to specify other occupiers of a work place to be liable for the responsibilities which we are presently placing only on principal contractors. This is in anticipation of the problem of illegal workers spreading to other business sectors. And if it emerges as a serious problem in the other sectors, apart from the construction industry, then the Minister could, by notification in the Gazette, bring in other work places within this provision.

Sir, clause 7 of the Bill amends section 16 of the Employment of Foreign Workers Act to enhance the power of employment inspectors. It empowers them to enter and search any premises where there could be evidence relating to the commission of an offence under the Employment of Foreign Workers Act. It also broadens the scope of their power to cater to investigation needs arising from the new section to hold principal contractors responsible for the illegal foreign workers found at their work place.

Sir, with these amendments, I believe we will be in a better position to deal with the rising problem of illegal foreign workers. These new measures should serve to discourage employers from flouting the law and deter foreigners from coming to Singapore to work illegally.

Sir, I beg to move.

Question proposed.

Mr Chiam See Tong: Sir, I believe this acute problem of too many foreign workers and the crimes committed by them are due to the acute shortage of accommodation for foreign workers. I have clients who have engaged foreign workers but are unable to get proper accommodation for them. It is probably because workers without proper accommodation have to go from worksite to worksite to get accommodation. The employers are paying large sums of money in terms of foreign worker levy. I would like to know whether the Minister is willing to use some of these levies to provide accommodation for this massive number of foreign workers.

Mr Chng Hee Kok (Tampines GRC): Sir, I agree with the general thrust of the Minister's points on the problems at construction worksites. My only concern is that in this Bill, as opposed to the Immigration (Amendment) Bill, "work place" is defined quite differently. In the case of the Immigration (Amendment) Bill, the Minister for Home Affairs has made it very clear that "work place" means the construction worksite. In the Employment of Foreign Workers (Amendment) Bill, "work place" is defined as "any place or premises where works are being carried out ...". I assume that the Minister's intention is that this Bill should apply to all and sundry, and not just to the construction worksite. Could the Minister clarify that "work place" defined in the Bill is targeted only at the construction industry? If it is meant to be a wide-ranging Bill, then I think he has to get the message across to all small and medium size enterprises. The Minister for Home Affairs has made it very clear that the Police have already been in contact with the Singapore Contractors Association on the problems at worksites. But no attempt has been made to inform all other employers that they are also liable under this Bill. Perhaps the Minister may like to clarify that the change in definition of "work place" is intentional and is meant to cover everyone besides the contractors.

Mr Charles Chong: Sir, I support the amendments moved by the Minister. However, there are concerns expressed by some contractors that the new provisions which are more stringent in some areas will affect their business operations, especially in situations where contracts have already been signed and works are in progress. I would like to urge the Minister to consider giving contractors a sufficient grace period before bringing the new provisions into force. This would give everyone time to make adjustments to comply with the new requirements.

Sir, new section 16C provides immunity from suits and other legal proceedings on the Controller or any person acting under his direction. Could the Minister provide clarification for the necessity of this new clause?

Other than these two concerns, I support the amendments.

Dr Lee Boon Yang: Mr Speaker, Sir, concerning Mr Chiam's query, I fail to see the link between the shortage of accommodation and the rising problem of illegal workers. This Bill concerns illegal foreign workers and the measures that are needed to deal with this problem of increasing numbers of illegal foreign workers. While the shortage of accommodation for foreign workers is in fact a problem faced by many employers, it has nothing to do with the subject that we are discussing today.

Anyway, for the Member's information, my Ministry is well aware of the shortage of accommodation for foreign workers and we have been working with the Ministry of National Development to look at ways to reduce or minimise this problem facing the employers. The Ministry of National Development has in fact identified certain sites which could be tendered out to employers to build short-term accommodation for foreign workers. In fact, such projects are under way. I believe one of the sites is somewhere in Bukit Batok and other sites have been identified.

The Ministry of National Development has also agreed to allow developers of industrial buildings to build quarters within their land, subject to certain plot ratio considerations, for their foreign workers.

The Ministry is also looking into reviewing the building regulations to ensure that contractors provide standard housing on worksites for their foreign workers. So the problem of accommodation can be solved by other ways. Today, we are not discussing this problem.

I do not think it is reasonable to ask for the foreign worker levy to be used to provide accommodation for foreign workers. The foreign worker levy is imposed to regulate the entry of foreign workers into Singapore and to ensure that these foreign workers do not unnecessarily depress the wages of Singaporeans. It is not meant to provide accommodation for foreign workers.

Mr Chng asked whether the measure introduced by the new section 6A will cover all work places. The intention here, as I explained in my Second Reading speech, is to focus on contractors to begin with. Hence, under clause 4, it creates a new section 6A(7) which explains that in this instance, an occupier in relation to a work place means the principal contractor who undertakes any construction work at the work place. I explained earlier on that if there is a need to extend this provision to other work places, then the Minister will, by gazette notification, bring in the other work places and at such time we will give due publicity to warn all the other employers that they are also subject to the same provision.

Let me reassure him that the intention of the new section 6A is focused at the contractors. We want to deal with this problem of illegal foreign workers at the construction site first.

Mr Charles Chong voiced his support for the Bill and asked whether contractors who have a project that is under way could be given a grace period to comply with the new requirements under the Employment of Foreign Workers Act. Let me say that while we are introducing the requirement now, the warning had already been given much earlier on. As the Minister for Home Affairs pointed out, Police had since October last year served warnings to contractors about tightening their worksite access control measures. I have also warned employers about illegal foreign workers during the Committee of Supply debate earlier this year. I said that my Ministry would be introducing a new provision and regulation to deal with this problem. So in fact contractors have been adequately warned about the new measures that are going to be put in place to deal with the problem. Nevertheless, we are reasonable and we will be prepared to consider the request from the contractors. We will be prepared to discuss with the Contractors' Association on an appropriate grace period before the new provisions are brought into force. But this grace period cannot be a very lengthy grace period in view of the many occasions where we have already warned the industry of the new measures that will be put in place.

Mr Charles Chong also asked whether it is necessary to provide immunity from suits to officers of my Ministry in the conduct of their investigations into illegal workers. I think this is a standard procedure that officers carrying out such enforcement duty should be protected from any civil suit.

Mr Chng Hee Kok: Sir, I seek a clarification from the Minister. I am quite comfortable with his reply, but I do not understand why "work place" in this Bill is defined quite differently from the Bill that has just been moved by the Minister for Home Affairs. The Minister for Home Affairs moved a Bill that specifies "work place" as a construction worksite. It is a very specific definition, Sir.

Dr Lee Boon Yang: Mr Speaker, Sir, under the new section 6A(2) we said that where a foreigner without a valid work permit is found at any work place it shall be presumed that he has been employed by the occupier. But in the new subsection (7) we clarified what we meant by "occupier" and "principal contractor". That should put in focus the fact that we are only targeting at contractors at this stage and, if necessary, the Minister will have the power, by gazette notification, to include other work places under section 6A. The Minister for Home Affairs will explain to the Member why the differences.

Mr Wong Kan Seng: The wordings may be different but the spirit is the same. Let me read to the Member this clause in the Immigration (Amendment) Bill:

`"Work place" means any place or premises where any construction works are being carried out and includes:

(a) all the land within the vicinity of the work place which are owned by the person for whom the construction works are being carried out and to which the principal contractor has control of access;

(b) any canteen, sleeping quarters, office and other structures or buildings erected on the work place; and

(c)[this is a very important point] such other place or premises as the Minister may, by notification in the Gazette, specify to be a work place.'

So it can be any place.

Question put, and agreed to.

Bill accordingly read a Second time and committed to a Committee of the whole House.

The House immediately resolved itself into a Committee on the Bill. - [Dr Lee Boon Yang].

Bill considered in Committee; reported without amendment; read a Third time and passed.