Industrial Relations (Amendment) Bill

I rise in strong support of the Industrial Relations Amendment Bill. I declare my interest as a member of the tripartite workgroup for the review of the Employment Act, as well as the IR Act. Representing NTUC and the Labour Movement, we discussed, consulted widely, reviewed, negotiated and promulgated this deck of changes with our tripartite partners, MOM and the Singapore National Employer's Federation. I must say that the discussions and negotiations were robust. We also worked out and issued a deck of tripartite guidelines which were issued shortly after the First Reading of this Bill.

If we take a closer look at our Singapore workforce profile, it is changing rapidly. The number of PMEs in our workforce now stands at 31.1%. Resident PMEs currently stand at 638,500. We expect this percentage to increase exponentially, with more embarking on tertiary qualifications and taking on executive jobs and becoming knowledge workers. Many of the new employees hired in our unionised companies these past years have Diploma and above qualifications. Many of the new jobs created require knowledge workers or PMEs.

In light of this change and development, it is imperative for NTUC and the Labour Movement to push for this review of the IR Act, a piece of legislation promulgated in 1965,

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to ensure we stay future-ready and relevant to our workforce and membership. In fact, I submit that it is in the interests of our tripartite partners to support this move to be inclusive and bring PMEs into the tripartite framework so as to fortify tripartism in Singapore and ensure it stays strong, relevant and continues to be the unique selling proposition for Singapore.

The introduction of individual limited representation of executives in 2002 and the setting up of the tripartite mediation framework in 2011 have been two key milestones in bringing PMEs into our fold and extending union representation to them. However, in this Amendment Bill, I cannot but underline the two key changes in this Amendment Bill which are landmark changes in our journey to reach out to and serve the PME populace in Singapore.

The first change is a watershed change to allow trade unions whose majority membership consists of non-executive and non-managerial employees, commonly referred to as rank-and-file unions, to be allowed to collectively represent PMEs.

The second change is the addition of re-employment as another head of claim under individual limited representation. These changes are by no means technical changes but are substantive changes, as our unions will be able to stretch their scope of representation and ensure that the welfare and interests of all workers, including PMEs as well as mature PMEs, can be looked after and that they can be collectively represented by unions. Except for certain excluded categories due to conflict of interests principles, there will not be a salary ceiling nor prescribed percentages and proportions to specifically curtail collective union representation of PMEs.

Supporting these changes, I would like to seek the Minister's clarifications on some questions which I hope he can explain and elucidate so as to aid the practice of industrial relations after these changes are passed as law.

In fact, one of the biggest challenges with coming up with the new provisions, as well as the set of tripartite guidelines, is how to best define the term "executives" and, consequently, where to draw the line of exclusion from union representation. Section 17(3) provides for some excluded categories of workers from this new collective representation of PMEs by our affiliated unions. I wish to confirm that the intention is to only exclude those who are in senior management positions or carrying out functions that would genuinely create conflict.

I ask this because the excluded categories are the same as those excluded under individual limited representation. When limited representation was introduced in 2002, the

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Minister said in Parliament that the Government accepted the Tripartite Committee's recommendation that "senior management staff and certain core management personnel could not be represented. These included those involved in hiring, firing, promotion, dismissal and disciplinary duties; those with access to confidential information, such as payroll and budgeting information; those who represent employers' interest in union-management matters and those whose union affiliation would give rise to conflict of interest."

To ensure the Labour Movement and tripartism stay relevant, inclusive and representative of the workforce, we want to confirm that for every organisation, this is but a small core group only and does not extend too far downwards. This is particularly so as with flatter organisations and matrix reporting, as many employees these days become indirectly involved in supervising and appraising staff at all levels. We should aim to cut off the top and senior management only and not all other managers and executives or else this change will not be impactful and progressive.

I am glad to note that the tripartite guidelines state that employers and unions may mutually agree to use a proportion of executives in the company and certain salaries as proxies, to determine eligibility for collective representation. More importantly, company structures and staff composition vary and, so, we urge employers and companies to be proactive, open and enlightened in approaching the implementation of this set of changes.

By the same token, section 30A(2)(b) further states "performs or exercises any function, duty or power which includes decision-making, or the power to substantially influence decision-making, on any industrial matters, including the employment, termination of employment, promotion, transfer, reward or discipline of other employees". We would want confirmation from the Minister that this excludes mid-level PMEs who have some supervisory functions and give input for appraisals, hiring, firing and so on such that they, too, can be represented.

I also seek clarity on the final category under section 30A(2)(e) – "performs or exercises any other function, duty or power which may give rise to a real or potential conflict of interest if he is represented by the trade union". I wish to ask the Minister how far this extends. Could we have some examples of what it is meant to cover?

In the area of recognition of a trade union to represent PMEs, I also ask the Minister to confirm that the union only needs to seek recognition for the new grades of executives that it seeks to represent collectively and that this is separate from and does not affect the recognition already obtained for the rank-and-file employees as such.

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Across our affiliated unions, we have started outreach to PMEs and I am very glad to share that many in senior and top management positions have joined us as union members to enjoy our full range of PME benefits, short of collective representation. We continue to organise and recruit those in senior and top management as union members and I am glad our tripartite partners support that. Mr Deputy Speaker, in Mandarin.

(In Mandarin): [Please refer to Vernacular Speech.] PMEs makes up one-third of the workforce. Going forward, this percentage will continue to rise.

The Industrial Relations (Amendment) Bill will bring about three main benefits:

First, the Bill will enlarge the scope of union representation to allow more PMEs to have collective representation and more bargaining power; second, limited representation will include re-employment issues which will provide better protection to the older PMEs; third, the set of amendments will make the IR Act more inclusive and it is a very proactive and delightful development by bringing more PMEs within the tripartite framework.

I have three wishes. First, I urge employers to support unions in their extension of the scope of representation; second, I hope that more PMEs can join the union as a member, so as to enjoy better protection and benefits; third, I hope Singapore's unique tripartite relationship would continue to strengthen and be ready to adapt to future changes in the workforce and the workplace.

(In English): In conclusion, I applaud this set of amendments to the IR Act and thank our tripartite partners for their support. I look forward to our affiliated unions and unionised branches enlarging their scope of representation and bringing even more PME members within their membership.

In our journey towards staying relevant and outreaching and advocating for PMEs, we, in NTUC and the Labour Movement, will continue our endeavour and efforts in representing the rank-and-file as they continue to be the lifeline of our workforce. In fact, with this set of amendments, the current dichotomy between the rank-and-file and PMEs will become increasingly irrelevant as we aim to serve all collars of workers.

I urge and encourage all employers to support unions in their extension of scope of representation and help ensure PMEs are brought within tripartism through union representation and support. This will also further enhance our labour-management relations and build a workforce which is represented, motivated, productive, future-ready and future-proofed.

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I call for PMEs in Singapore to embrace and take full advantage of this change by joining as union members and becoming a part of the Labour Movement of Singapore. I strongly support this Bill.

Mr Deputy Speaker, I rise in support of the amendments to the IR Act. History has shown that strong, responsible unions are essential to industrial fair play. Without unions, industrial relations could be wholly one-sided. The unions in Singapore have played a critical role to set the standards across the board in wages, employment benefits and working conditions. It is said, "If you are making a decent salary in a non-unionised company, you owe it to the unions. One thing that corporations do not do is to give out money out of the goodness of their hearts".

Given the changing profile of our workforce, the PMEs today will be the rank-and-file workers of tomorrow. The proposed amendments will allow the unions to remain relevant. With an increasing number of PMEs, the future direction for the Labour Movement is to get them organised and their union rights recognised by their employers as a condition precedent to creating a fairer workplace environment.

Mr Deputy Speaker, this amendment will allow the unions to give the PMEs a greater level of protection over their workplace rights. In the past, it was assumed that PMEs have the financial capability to engage their own lawyers for any employment matter disputes but the reality is that many junior PMEs may not have the financial ability to undertake their own legal recourse, leaving them in a very vulnerable position. The ability for unions to represent PMEs will create a workplace environment that promotes greater transparency and fairness to resolve employment related disputes.

Let me share the experience of my union, Building Construction and Timber Employees Union (BATU), with one of our unionised companies. The company underwent a major renovation. BATU had worked closely with the management on the deployment and transfer of the employees, many of whom were our union members. The management also allowed the union to negotiate on behalf of the junior PMEs as well, probably because many of them were our union members and there was no concern about conflict of interest.

While management exercised flexibility in this area, however, on matters related to annual increment (AI) and variable bonus (VB), the management went by the book and stated that the settlement for AI and VB was only applicable to the rank-and-file covered by the Collective Agreement (CA). Half of our junior PME union members were affected. The PMEs in different departments were given different quantums of payment. Needless to say,

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workers' morale was affected. With the proposed amendments, hopefully, we would see less of such cases and improve the quality of workplace treatment to one that is fair to workers and where issues of probable conflict of interest could be better managed.

The amendments would also allow the unions to have a bigger pool of capable members, including PMEs, that the union could tap on to enhance union leadership. In BATU, we had experienced a situation where one of our key branch officials was asked to step down from the union committee after he was promoted to a junior manager. He could only be a union member even though the members wanted him to continue as a union leader. Even though he had no real managerial or executive responsibility and could have continued serving in the union committee without any conflict of interest, the management was resolute in their refusal to allow him to continue in his capacity as a union leader.

Mr Deputy Speaker, there are potential PMEs who are union members that could provide strong leadership to the union. While I understand management's concerns with regard to allowing PMEs to join rank-and-file unions because of possible conflict of interests, however, allowing PMEs to be union leaders can promote a harmonious workplace environment between PMEs and the rank-and-file workers.

In one of our unionised companies, the branch chairman was a PME and he was not covered under the CA but the management allowed him to continue to be the branch official. As the branch chairman, he negotiated on the CA and AI for the rank-and-file workers and attended to their workplace grievances in the company as well. In this case, our PME union official was very clear on what would be good for the management and what would be fair to the workers. He was able to achieve a win-win outcome for both parties and, hence, helped to maintain a harmonious labour-management relationship. With the proposed amendments, I foresee unions benefiting from having greater clarity on the PMEs who could be roped in to be part of the union leadership.

Mr Deputy Speaker, the proposed amendments would also promote greater ease and efficiency for unions and management during CA negotiations. In one of our unionised companies, the management allowed the unions to represent the rank-and-file workers and junior PMEs as well, but insisted on separate CAs to minimise any potential conflict of interest. Even though BATU suggested to work towards one CA, as many of the PMEs have no managerial or executive responsibilities and were earning below $4,500, we faced strong objections from the management. The merger could have benefited all parties in terms of a common negotiation and allow for a more fruitful outcome, but the "no consent" by the management stalled the efforts for a combined CA. With the proposed amendment, we expect the above obstacles to disappear and the grey area on PME eligibility for union representation to diminish.

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While I support the proposed amendments, I would like to suggest that MOM reconsider the guidelines on excluding salaried staff that have access to confidential information, such as the budget and finances of the company, or the salaried and personal records of other rank-and-file employees. There are instances where the staff are often tasked with mere processing and the nature of the job is mostly administrative. As such, they may stand to lose out more from being excluded from the CA, especially so as they may not be earning much to begin with. While I understand the concerns of including such staff, we should try to push to include rather than exclude as many as possible. Mr Deputy Speaker, in Malay, please.

(In Malay): [Please refer to Vernacular Speech.] The amendments to the IR Act will allow more PMEs to be represented by the unions during the collective agreement negotiations, as well as in the prevention and resolution of disputes at the workplace.

Among the amendments proposed to the IR Act is for the unions to represent PMEs on issues related to re-employment practices. Presently, many workers, including those who are PMEs, are still healthy and wish to continue working. With this amendment, if employers do not allow a PME who is a union member to continue working when the worker reaches 62 years old, the union can initiate discussions with the employer to ensure that the justification or compensation given is reasonable.

(In English): The profile of our labour force is changing. While rank-and-file workers have been the backbone of the Labour Movement, the rising numbers of PMEs are a force to be reckoned with. To be free, employees must be given a choice, regardless of whether they are rank-and-file workers or PMEs. To have choice, they must retain in their own hands the right to union representation and be part of the union family. I support the Industrial Relations (Amendment) Bill.

Mr Deputy Speaker, thank you for allowing me to speak on this Bill. I do wish to highlight my interest as I am also the Managing Director of an MNC operating in Singapore.

PMEs make up more than 30% of the workforce in Singapore and employment of PMEs is growing faster than that of non-PMEs. Based on the latest Labour Force Report in Singapore 2013, the profile of PMEs reflects the higher educational profile of PMEs and the median age of PMEs is 41 years of age, with professionals the youngest at 37 years. With the growing proportion of PMEs in the workforce, it is, therefore, important that there be

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consideration given to how the interest of this group of employees is to be represented.

To address concerns of conflict of interest and the undermining of management effectiveness of employers, currently only executive unions can represent employees in managerial and executive positions on a collective basis. The amendment Bill to the IR Act is recommending that constraints for collective representation for executive employees by the rank-and-file (R&F) unions be removed.

To prevent conflict of interest, I support the recommendations in the amendment Bill to exclude executive employees with specific roles and responsibilities from collective representation by rank-and-file unions. These include: executive employees in senior management positions who have a substantial decision-making role on industrial matters – someone who represents the employer in industrial negotiations; executive employees that have access to confidential, budget and financial information, including HR data; roles which perform or exercise any function or duty of power that may give rise to conflict of interest if they were represented by the trade unions. These are real conflicts of interests as they impact policies, they impact decision-making in an organisation and it does undermine the effective operations of the organisation.

Sir, we will all agree that PMEs are a heterogeneous group and have varied interests. I am recommending that guidance to employers on benefits for collective representation needs to be considered at the company or the firm level rather than across an industry or job roles. PMEs have varied job scopes and responsibilities. Therefore, to try to classify collective representation of PMEs within an industry would be difficult. To do it by job title may also not be viable. This is especially the case for global companies as their HR policies and benefits are determined at a global level while taking into consideration the local laws in the country of operation.

The Tripartite Guidelines on Expanding the Scope of Limited Representation for Executives, which was released on 26 November 2014, indicates that apart from using specific responsibilities, unions and employers may agree to adopt salary level as a proxy to determine eligibility. I suggest that rather than focusing on how much PMEs are paid, as responsibilities may be very different, it may be more appropriate to look at other factors or concerns impacting the role, for example, the hours of work, work flexibility and performance. Employers and unions should ensure that there is a framework of performance for employees and how performance is assessed. With regard to employee performance, to ensure that executive employees' interests are considered, employers need to have a clear process for performance feedback and management for executive employees. Feedback on performance must also be given to executive employees in advance and not only at the point of notification for dismissal.

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While the Tripartite Guidelines indicates that the rank-and-file unions may represent its executive members individually for dismissal without cause and excuse, employers should still have the right to terminate for compliance, misconduct and poor business outlook and prospects.

The recommendation of the tripartite partners also indicates the expansion of the scope of limited individual representation for executive employees to include re-employment benefits. Given the profile and growing proportion of PMEs in the workforce, the question I am asking is: should re-employment be included for collective representation? Should unions and employers be negotiating a framework whereby the conditions or considerations for re-employment are outlined for PMEs? This may then minimise disputes regarding re-employment for executive employees.

I do want, however, to sound a note of caution. While it is important to take care of the interest of PMEs as they are a growing proportion of the workforce, the concerns of employers with regard to management effectiveness being undermined with increased union representation of executive employees cannot be ignored as this will impact decision for placing operations in Singapore and, ultimately, jobs.

The Bill does try to address some of these concerns by outlining the scope of union representation by excluding executive employees with specific responsibilities as outlined earlier. The Tripartite Guidelines do supplement this by clarifying participation of executive employees in industrial actions. Taken together, there is some clarity to employers on the scope of representation, as well as the participation in industrial actions for executive employees.

For management effectiveness, the amendment to the IR Act does make it not an offence for employers to require, as a condition for appointment or promotion of an executive employee with the specific responsibilities outlined, that the individual is not permitted to assume office or be a member of the rank-and-file union.

Once the Bill has been passed, it is important that the Tripartite Panel consider putting in place timeframes for the dispute resolution process. This will ensure that executive employees' concerns are dealt with expeditiously and with efficiency. In addition to building timeframes for efficient dispute resolution, I suggest that the panel consider the dispute mechanism so as to find the most effective way to resolve employee and employer concerns. As discussed earlier, the concerns of PMEs are varied and complex and trying to classify concerns by PME roles or across an industry may not be feasible. The recommendation is that concerns be taken at a company level.

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Ultimately, for the amendments to be effective, the unions will have to convince both PMEs, as well as employers, of the benefits of increased representation. Sir, with the above considerations, I support the Bill.

Ms Lee Li Lian (Punggol East): Thank you, Sir. According to Singapore Workforce 2014 by MOM, the number of resident PMEs has increased by an average of 4% per annum over the past 10 years. Today, PMEs comprise about 31% of the workforce and this number is expected to continue to grow. With the growing proportion of PMEs in the workforce, amendments made in this Bill to provide better protection for more workers are thus welcomed. I have two clarifications on the Bill.

The first one, according to section 17(3), there is limited representation for executive employees. This could possibly include employees who are in junior or mid-level management, with job functions that include managing, directing, legal, human resource and finance.

What could these employees do when they want to seek redress? Given that employees in Singapore could be multitasking within the company, this could lead to many employees having limited representation under this Bill. This could also lead to contractual manipulation by employers to restrict their employees' rights. What can be done to prevent this?

In addition, is there any person or class of persons which the gazette had declared not to be employees for the purpose of this Bill? For class of persons with limited representation under the Bill, should their occupation not be stated explicitly in the Gazette or the Act itself to avoid confusion and surprises? What can the Ministry do to help employees make an informed choice when accepting a job offer or taking on additional job scope? What does the Ministry intend to do to generate more awareness among employees about this Bill, especially those with limited representation?

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Next, this Bill also excludes trade unions which have not been given recognition by an employer to act on behalf of employees. In order to know if there is adequate representation, how many trade unions have applied to be accorded recognition by employers and how many have successfully done so?

In conclusion, I look forward to the Minister's clarifications on the points raised.

Mr Deputy Speaker, Sir, thank you for allowing me to join this debate. Sir, since 2010, the Government has made tremendous efforts to rationalise the structure of the labour force to ensure that it is placed on a more sustainable footing. The move away from excessive reliance on foreign manpower has been at the centre of such efforts. I have been particularly heartened by the Government's decision to take the hard choice of keeping to a consistent line on the gradual pace of increasing foreign manpower levies. I have no doubt that such a policy will stand us in good stead in the long run.

Limiting the growth of foreign manpower has been a necessary if difficult move, but will not, by itself, be sufficient to produce the transformation of the labour force we need as rapidly as we would like.

Sir, the transformation can be quickened by creating a more conducive climate for change as well as deepening the extent to which labour market participants can involve themselves in that change.

Hence, apart from just focusing on foreign manpower limitations, the Government has also worked on other fronts, including encouraging increased labour force participation of older workers and women, promoting continuing education and training and emphasising

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the deepening of skills before the pursuit of qualifications.

In 2012, in recognition of the ageing of our workforce, a new re-employment law was introduced.

Sir, the current Bill before us takes account of the changing profile of the labour force and is another important policy response that will enable the Singapore workforce to meet its challenges in bridging that gap in transformation.

Contrary to the view that we should reduce or slow down the curbs on foreign manpower, I believe what we should do is to accelerate the pace of the adjustments at all levels so that the ultimate objective of a more sustainable, productivity-enhancing model of labour force growth can be achieved sooner.

Advancing the activism of labour unions in these areas of change can help to propel the labour force towards that goal faster. This is how I interpret the implications of the amendments in this Bill. Singapore's record of industrial harmony has been a key pillar of its success and is another debt we owe the Pioneer Generation who built this nation of ours. The harder that workers of our Pioneer Generation toiled, the more self-effacing they were and the quieter they remained about their achievements.

In the next phase of our nation building, workers will continue to be a key factor. Hence, it is important for labour unions to remain as representative as possible in the face of changes in the profile of the labour force.

Although increased union activity could increase costs for employers, such activity need not always be an impediment. As disruptive technologies pose a huge challenge to workers as well as their employers, responsible unions can instead drive change in the right direction. In order to nurture a resilient and sophisticated workforce in response, the union movement can play an important role through its membership base to effect change in areas, such as workforce upgrading as well as improvement in work processes.

Apart from collective bargaining, this Bill expands rank-and-file union representation of individual executive employees to disputes in re-employment. This is an important new step, building on the labour market flexibility that resulted from the introduction of the Retirement and Re-employment Act of 2012.

Sir, this Bill is an important demonstration of the continuing policy responsiveness of this Government in labour market matters. It sees to the changing needs of workers as a

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result of evolving conditions in our labour market.

I have only one question about this Bill. I would like to know why the Bill makes such a limited expansion in the number of areas where rank-and-file unions are allowed to represent executive employees. There are other areas where allowing such representation would be useful. Just as re-employment is a growing area of concern for an economy with an ageing population and a limited indigenous labour force, fair competition for jobs is also important. At the moment, such matters come under TAFEP. I would argue that labour unions should be allowed to represent executive employees in hiring disputes. Labour unions are well-placed to move beyond the emotive aspects of such disputes and to engage constructively with employers to understand the situation from the employers' perspective. For a country which has been reliant on and benefiting from foreign manpower for as long as we can remember, this is not a trivial issue and adding a union perspective in dealing with hiring disputes will be an important addition.

By availing union representation to executive employees in hiring disputes, local workers will be given deeper assurance of the protection they can depend on, while unions will gain a broader understanding of the true state of the level and type of competition local workers face and, hence, be equipped to conduct more effective advocacy on their behalf against actual hiring biases. Ultimately, beyond approaching the issue from an adversarial perspective, more can be done to deepen our understanding about the trade-off between labour market diversity and nurturing of local talent that enters into every employer's hiring consideration. Given the fact that the openness of the labour market has been an important contributor to our economic development, it would be important for the union movement to play an active and responsible role in preserving the delicate balance in hiring that is key to that openness.

Beyond hiring disputes, there are other areas which concern executive employees that would ultimately impact the development of the local workforce. In general, I believe it is useful to see the Bill in a larger context.

Sir, throughout the world, labour unions are transforming, moving beyond confrontation and seeking to re-position themselves to address contemporary issues such as international competition. With a broader scope of representation, unions can take the initiative to approach employers and explore concerns about issues, such as job matches and a workplace that is more conducive to productivity.

In conclusion, I believe that the importance of the Amendment Bill is that it recognises that changes in the labour market should be supported by a more responsive framework in the laws governing labour union representation. Without the support of an up-to-date legal

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framework, workers will feel unrepresented and unions risk becoming irrelevant.

In this day and age, most union leaders, especially in Singapore, understand that it is better to increase the value of workers to employers as a means of getting a better deal. They understand that calls for pay increases that are unsupported by improved performance could simply translate into lower employment.

For this reason, I urge the Government to continue to explore expansion of areas in which rank-and-file unions can represent executive employees and to consider ways to strengthen the capacity of responsible unions in engaging employers. Mr Deputy Speaker, Sir, I support the Bill.

Mr Deputy Speaker, I would like to thank Mr Patrick Tay, Mr Zainal Sapari, Ms Jessica Tan, Mr Ang Hin Kee, Ms Lee Li Lian, Mr K Karthikeyan, Assoc Prof Randolph Tan, Mr Yeo Guat Kwang and Mr Heng Chee How for their views and support for the proposed changes to the IR Act.

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Mr Patrick Tay and Ms Lee Li Lian sought clarification on the five grounds of exclusion from collective representation with regard to the extent to which the exclusions will kick in and cases where union affiliation could give rise to conflict of interest. Mr Zainal Sapari suggested not excluding from collective representation salaried workers who merely process confidential information and who do not hold senior positions in their companies.

Mr Deputy Speaker, the tripartite partners have carefully considered the criteria to determine eligibility for collective representation and consciously decided not to be overly prescriptive. In determining the classes of employees to be represented, it is important to preserve flexibility for employers and unions in their negotiations. As the proposed amendments are meant to allow executives greater access to union representation, the exclusions are generally not meant to apply to junior executives. Furthermore, employees who are tasked with mere processing of confidential information would generally not be executives and, hence, are not included within the scope of this Bill.

The specific executives or classes of executives who are eligible to be represented will, ultimately, depend on the circumstances and structures of the organisations. Employers and unions should work closely in the spirit of cooperation to reach an agreement on the issue of eligibility.

As I highlighted earlier, we all would generally prefer more prescriptive definitions, we would like clearer parameters, but the world has changed. It is a lot more difficult to define the specific roles for each of these PMEs, as executives. As I have mentioned, in different organisations, you have different structures. In a particular organisation, an executive may hold certain responsibilities. In another, it could be quite different. So, we believe that, in the spirit of tripartism, this space afforded both employers and unions would allow negotiations to take place. We need to learn to embrace that change and to embrace that space that we have in order for us to carve out what we define as a common space for everyone to move on.

In our consultations on the Bill, employers have raised concerns on the impact on business operations and managerial effectiveness. We have heard Ms Jessica Tan's concerns and this is echoed by many of the companies out there. We understand that. It is important to realise that there are conflicting needs – unions, workers, employees. Employees may prefer much more extensive inclusion, a more inclusive approach, whereas companies would have reservations, and both views are valid. Ultimately, we need to find a halfway position not so much directly in the middle but a formulation that works best for all parties concerned and ultimately benefits all of us here in Singapore.

So, let me first assure the House that the proposed amendments that we are debating today are meant to provide those additional options for employers and unions to consider.

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Employers and unions can adopt the modality and arrangement that best suit the structure and circumstances of the organisation and the needs of their executives. To address employers' concerns, we have, as mentioned, taken the approach of allowing flexible implementation on the ground to take into account the differences that exist across industries and organisational circumstances and, in the consultation, that has come out quite clearly.

In response to requests from employers, the tripartite partners have released a set of guidelines ahead of the legislative amendments to help prepare unions and employers early and address concerns that they had about how they should adapt to the proposed amendments. Again, these are the guidelines that are issued by our tripartite partnership and we have taken on board many of the various views and concerns expressed by many of you here in the House.

Employers have also highlighted in our consultations that the needs of the executives are different from the rank-and-file employees. Executives are a heterogeneous group, with a more individualised pay structure. Their remuneration package includes items, such as performance bonus or wage increment, which are pegged to their individual performance, rather than being fixed. In addition, the pay structure of the executives in multinational companies is typically determined, as highlighted by Ms Jessica Tan, by the global HR policies that are beyond the shores of Singapore. These conditions make it challenging for us to negotiate for traditional collective agreement items, such as wage increments or bonuses.

Mr Deputy Speaker, as mentioned earlier, we do want to avoid a narrow prescription of the arrangement that unions and employers should have. In fact, that is the wise approach to take in this instance. Both parties should be given the maximum amount of leeway for them to work out an arrangement that best suits the needs of their executives. This round of amendments will broaden the range of options for unions and employers to consider.

For example, the tripartite partners noted that granting recognition for collective representation of executives may not necessarily lead to collective agreements. Collective representation should focus on what is of collective interest to the executives. For certain companies and executives whose employment terms and benefits are highly individualised, the union can assist the executives in other areas which may be more important to the executives, such as career and skills development. The outcome will, therefore, be one where unions, executives and employers can all benefit.

Mr Patrick Tay also sought clarification on the union recognition process to represent executives. Unions which have been accorded recognition by the company for rank-and-file employees will have to seek recognition for the new classes of executives that it seeks to

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represent collectively.

I would like to thank Mr K Karthikeyan, Ms Jessica Tan, Assoc Prof Randolph Tan and Mr Heng Chee How for their support for expanding the scope of limited representation to include re-employment disputes.

The Retirement and Re-employment Act (RRA) that came into effect in 2012 covers all employees. This amendment complements the RRA to allow rank-and-file unions to represent its executive members in negotiations with employers on an individual basis for re-employment matters.

Assoc Prof Randolph Tan also suggested that we further expand the scope of limited representation to represent executives in ensuring fair competition for jobs. These are important concerns for executives and my Ministry has introduced the Fair Consideration Framework in 2013 to address these concerns.

Limited representation for executives, on the other hand, largely focuses on end of employment issues, such as dismissal, breach of individual employment contract, retrenchment benefits and re-employment, for which unions can help in resolving disputes for their executive members who have been employees of the organisation. Thus, limited representation is perhaps not quite the right mechanism to deal with the issue of fair competition for jobs. For that area of concern, we have introduced other measures in this House previously.

Ms Lee Li Lian asked what can be done to help the executives who remain excluded by the proposed amendments. She would be pleased to note that the upcoming Employment Claims Tribunal, which I mentioned earlier, will cover all employees including executives earning above $4,500 and regardless of job responsibilities, and provide them with an expeditious and affordable channel for resolving their various employment disputes which, we know, crop up from time to time.

Ms Lee also asked about the number of trade unions that are approved for representing executives for purposes of negotiating with unions. We have received feedback from NTUC that some unions have discussed and worked out agreements with management on the forms of representation for executives. However, we do not have the official statistics as yet.

Since the introduction of limited representation in 2002, many unions have recruited many executives to join their ranks. This is not a new move. We started this move quite some time ago. We are building on it. Mr Ang Hin Kee and Mr Zainal Sapari shared about how their unions have built up over time to serve more executives. I am heartened to hear about the

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good progress made by the rank-and-file unions which have benefited many junior executives.

Mr Yeo Guat Kwang spoke about the transition that unions have to go through in response to the changing workforce profile. Rank-and-file workers will remain the core of rank-and-file unions. I would strongly encourage the unions to persevere in reaching out to the executives, so that they can also better serve the needs of this growing group for a more inclusive Labour Movement. And with the proposed amendments, rank-and-file unions can serve the needs of all classes of workers.

This transition is not just for the unions. The Government and employers have to evolve as well. I have outlined earlier the slew of initiatives that the Government has rolled out targeting the executives. Employers, too, need to step up to these changes and work with the unions in addressing the needs of their executives.

To sum up, this Bill will provide additional options for workplace representation of our executives. There will be an additional avenue for executives to seek collective representation. Limited representation will continue to be an option to help executives address their individual disputes at the workplace, including re-employment disputes. I would like to assure Ms Jessica Tan and Members of the House that my Ministry will ensure that disputes arising out of the implementation of the IR Act will be dealt with in an expeditious and efficient manner.

Mr Deputy Speaker, this Bill is a culmination of the tripartite partners' efforts over more than a decade to make our model of tripartitism more inclusive. It is timely for us to review how we can expand and deepen our tripartite model to benefit rank-and-file employees, as we have done so over the years, as well as to look after the growing number of executives in our workforce.

I would like to echo what Mr Heng Chee How shared about the industrial relations and industrial peace that we have enjoyed, how important that has been for all our well-being. It is not something we should take for granted. We often do take it for granted in Singapore. In fact, we would be hard pressed to find the occasions where these conflicts come to a head, but it is common in many other countries. It affects investors' confidence. As highlighted by Mr Heng Chee How, there are many different factors that investors look at when they consider moving to a particular country.

Indeed, compared to the past, we are not as cheap as before. That is simply because we have developed and that is a good thing. But we need to retain the competitive advantage because when companies and other investors are confident in Singapore and they

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anchor themselves here, they create opportunities for our people and that is important.

Our unique tripartite model has been a key competitive advantage for us in our 50 years of nationhood and that has enabled companies to invest in Singapore for the long term with confidence. This tripartite partnership where the unions, employers and the Government continue to work closely together is not something that we want to take for granted. As the world evolves, as the society evolves, we need to evolve our model of tripartism as well.

With this round of amendments, more disputes can be addressed early at the enterprise level, between unions and management. It will allow management now to bring to the fore PMEs and for executives to be represented by a partner whom they are familiar with and whom they have had a constructive relationship with over the many years. This will allow and provide avenues to further strengthen the labour-management relationship at the organisational level and allow our model of tripartism to be a continued source of strength for Singapore, ultimately, benefiting all Singaporeans.

So, once again, I thank all our stakeholders, including Members of the House, for their suggestions and inputs and for their support of this Bill.