23 May 2013

Employers Must Do the Right Thing

23 May 2013

When I read the update from the CPF Board that they have helped to recover some $293 million of CPF arrears (including late payments) for more than 200,000 local workers last year, the numbers stood out. This is why we initiated the 'WorkRight' effort and we are stepping up our inspections ten-fold. 

The sum is indeed not small, and is a cause of concern.  Employees work hard to contribute to their companies and they should not be denied their rightful CPF contributions. CPF savings are important to all Singaporeans, especially for vulnerable groups of low-wage workers who rely on it to fund their retirement, healthcare and housing needs. 

It is certainly not right for companies to deprive workers of their CPF. It is an offence under the CPF Act for employers to default on CPF contributions, and action is taken against companies who underpay or do not pay CPF to their employees. Currently, employers who break the law by underpaying or not paying CPF will be fined up to $10,000.

I have tasked my colleagues in MOM and CPF Board to review the penalties under the CPF Act, especially since the numbers show that non-compliant employers affected more than 200,000 local workers last year. By upping the penalties, this will hopefully serve as a stronger deterrence for employers. I also hope this will help to ensure that every employee is given timely CPF contributions, and that no worker is deprived of what is rightfully his or hers.

But it should not all be about the “stick”.

Both MOM and the CPF Board have stepped up efforts to bring about greater compliance with the CPF Act and Employment Act. We want to ensure that employees, particularly more vulnerable groups like low-wage workers receive their salary on time, are paid their CPF contributions, and are provided with paid annual and sick leave, amongst others. 

Since last September, through the “WorkRight” outreach, MOM and the CPF Board have jointly been educating workers on their employment rights and reminding employers of their obligations through various channels such as print advertisements and talks. We have also stepped up enforcement activities. Previously, our annual number of inspections on employment rights averaged 500. In the last four months alone, WorkRight inspectors have already conducted 800 inspections.

On-site WorkRight inspection to raise locals’ awareness of their employment rights

One employee who has benefited from WorkRight inspections is Mr Chua (not his real name). His employer was found to have underpaid CPF contributions from Jan 01 to Nov 12. After investigations, his employer was educated about his CPF liability and advised to pay the remaining CPF arrears. In all, we managed to recover $26,000 for Mr Chua. This is not a small sum – and 56-year-old Mr Chua was immensely grateful as this amount would contribute towards his savings for retirement. 

Employers must do the right thing and pay their local employees what is due to them in CPF contributions. Employees should also check their CPF accounts regularly by calling the CPF hotline 1800-221-9922 or via the CPF website to ensure that their employers have made the correct CPF payments.

If you know of employers who are not fulfilling their CPF obligations, do report by calling 1800-221-9922 or emailing Rest assured that the identity of the caller will be kept strictly confidential.

Let’s continue to ensure we all work together to make things Right for workers!

Acting Minister for Manpower 
Tan Chuan-Jin

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