‘Hiring foreigners? Pay locals min. $1,400’: Singapore government to employers

The Government of Singapore has tightened the local qualifying salary (LQS) in a bid to support locals drawing lower wages

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Singapore has taken a step towards lower-wage workers in the country. The Government has said that all organisations hiring foreign workers will have to pay all their local employees at least $1,400 per month as salary. In other words, the Local Qualifying Salary or LQS has been tightened, in a bid to support the lower-income workers.

Prime Minister Lee Hsien Loong made this announcement recently during the National Day Rally.

The Government of Singapore has also made provisions for the progressive wage model or PWM to be applicable to more sectors and professions, including retail and food services. The model defines a minimum wage that needs to be paid by employers on the basis of the skills of the workers. This has resulted in improved productivity and also raised the skill levels of workers. Singapore will soon roll out a scheme to recognise and accredit employers and firms that pay workers progressive wages.

At the national level, the Government is planning to hike its expenditure on the Workfare Income Supplement, to $1.1 billion by 2023. Currently, the Government pays about $850 million towards this workfare. Under this scheme, the incomes of lower-wage workers and self-employed citizens will be topped up in cash along with the contributions towards the Central Provident Fund (CPF), which is presently benefitting about half a million workers. The scheme, which is presently applicable to those who are at least 35 years old, will soon cover those who are 30 and above.

These steps are expected to ensure that the lower-wage workers get better incomes within 24 months and also enjoy more job security and are able to save more for emergencies, such as the pandemic.

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