UNION REPRESENTATION OF EXECUTIVES (Progress report of Tripartite Committee)

Mr Yeo Guat Kwang asked the Minister for Manpower if he will give a progress report of the Tripartite Committee on union representation of executives.

The Minister for Manpower (Dr Lee Boon Yang): Mr Speaker, Sir, in August last year, I informed the House that the Ministry of Manpower would set up a Tripartite Committee to examine the issue of allowing junior and middle level executives to join rank-and-file unions. This Committee was chaired by the Minister of State for Manpower with members from the National Trades Union Congress (NTUC), Singapore National Employers' Federation (SNEF), the American Business Council, the Japanese Chamber of Commerce and Industry, the German Business Group as well as representatives from my Ministry and the Ministry of Trade and Industry. The Committee held consultations with union and employer groups for feedback and views on the issue. It has completed its study and submitted its recommendations to the Government for consideration.

The Committee pointed out that Singapore has enjoyed a high level of industrial harmony and that our trade unions have adopted a cooperative approach to strengthen labour management relations for the benefit of employers and workers. For example, the NTUC and its affiliates persuaded workers to take a cut in employers' CPF contributions during the Asian financial crisis. They have been proactive in skills upgrading with initiatives such as the Skills Redevelopment Programme (SRP) to help workers add value to their companies and remain employable.

The Committee noted that under existing laws, executives could form their own unions to represent their interests and engage in collective bargaining with employers. It also noted that the educational and occupational profile of Singapore's workforce has changed significantly over the years. With an increasing proportion of the workforce being better educated, more employees are expected to join the executive ranks. This could result in an employer having to deal with two or more unions in the company if executives opted to form their own unions. The NTUC was of the view that a single union at a workplace is preferable to multiple unions. A single union could better promote teamwork and closer labour management cooperation. NTUC also pointed out that a single union representing rank-and-file workers and executives would enable unions to draw good leaders from a larger talent pool. Good leadership in our union movement is critical to ensure that trade unions are able to serve workers and help to enhance tripartite cooperation.

The Committee also noted employers' concern that unionization of executives in rank-and-file unions could affect management effectiveness and flexibility. Employers had expressed concerns that there could be conflict of interest, which may undermine business competitiveness. Some MNCs were worried about the unionization of their executives in the light of the adversarial labour-management relations in their home countries.

The Committee noted the concerns of both employers and unions. It concluded that in view of our harmonious labour management relations, it would be desirable to allow some executives to join rank-and-file unions. The Committee proposed that executives who do not have senior management responsibility and substantial managerial functions such as hiring, promotion, dismissal and disciplinary functions, be allowed to join rank-and-file unions. They could be represented by the rank-and-file unions on an individual basis in respect of retrenchment and dismissal but not for collective bargaining purposes. The Committee held the view that this approach would enable the unions to maintain their membership base yet avoid conflicts of interest or loss of management effectiveness and flexibility.

To ensure that its recommendations do not adversely affect labour management relations and Singapore's economic competitiveness, the Committee further proposed that a Tripartite Working Group be set up to study the implementation issues and to reach out to employer groups to explain the recommendations. In the meantime, the Ministry should consider appropriate legislative changes to the Industrial Relations Act to enable some executives to be represented by rank-and-file unions.

Mr Speaker, Sir, I am pleased to inform the House that the Government has accepted the recommendations of the Tripartite Committee, including setting up a Tripartite Working Group and studying amendments to the Industrial Relations Act. I would like to take this opportunity to thank members of the Tripartite Committee for their contributions.