Industrial Relations

INTRODUCTION

The industrial relations in Singapore were confrontational in the 1950s and early 1960s, with high number of strikes, high unemployment, poor working conditions, and social unrest. The separation from Malaysia in August 1965 marked a historic turning point. Singapore faced a challenge to attract foreign investment, create jobs for Singaporean and achieve sustainable growth. With the right strategy, Singapore, a tiny country which has no natural resources has transformed into an affluent and modern city state with a per capita income of US$30,000, far above the neighbouring countries Malaysia (US$6,948), Thailand (US$3,737) and Indonesia (US$2,271)^[1] Such economic growth in Singapore did not happen by chance. It is a carefully orchestrated effort by the ruling government to involve the three social partners, namely Ministry of Manpower (MOM), Singapore National Employers Federation (SNEF) and the National Trade Union Congress (NTUC) to work in concert to achieve such economic success.

Being hit by the recent global financial crisis in July 2008, Singapore suffered from the escalating job losses and unemployment, which resulted in the fall of the GPD to -1.3% and increase unemployment rate to 3%.

But Singapore again has proven its strength to recover rapidly.  In first quarter of 2010, the GDP growth was 15.5% and unemployment rate improves to 2.2%.  Talking about this success of Singapore, in a recent interview with Charlie Rose (American talk show host and journalist), the Prime Minister, Mr Lee Hsien Loong, cited some factors for the rapid recovery such as: The world, Singapore included benefited from the right policies implemented by the US authority and the open of the two resorts at the right time which helped to created 20,000 to 30,000 jobs and attracted many tourists. Above all, he emphasised on the collaboration of tripartite partners in setting up the policies and programs that enables Singapore to preserve capacity (e.g. the Jobs Credit scheme) and upgrade capabilities (e.g. the Skills Programme for Upgrading and Resilience) so as to minimise both the impact on workers and long-term damage to the economy. And recently, the tripartite partners also shared the current national thrusts of the Economic Strategies Committee on skills, productivity and innovation.

With these evidence, we do not agree with the statement that the collaboration among the three social partners is only evident at the national level vis-à-vis MOM, SNEF and the NTUC. Instead, we felt that such collaboration is cascaded down effectively to employers and employees as can be demonstrated by the ability of the partners to arrive at programs to circumvent the adverse effects of the recent global financial crisis.

SUCCESS FACTORS OF TRIPARTITISM IN SINGAPORE

1) Legal Structure

Much of Singapore’s economic success can be tied to the following legislatures that have been put in place to govern the industry and workforce as well as to maintain industry order:

Employment Act: the main legislation governing the terms and conditions of employment in Singapore, covers employees except for seamen, domestic servants, and any person in a managerial, executive.

Industrial Relations Act: regulates the conduct of industrial relations between the employers and trade unions and provides the system for governing prevention and settlement of trade disputes through collective bargaining, conciliation and arbitration

The Trade Unions Act governs the registration and regulation of trade unions, the management of union affairs and union finances, and the election of union officers.

Work Injury Compensation Act: sets out the basis of compensation for an employee who dies or is injured arising out of and in the course of employment.

Workplace Safety & Health Act: governs workplace safety and health to cultivate safety culture and reduce risk at the workplace.

2) Tripartism – Roles of the Government, Employers and Unions

Each tripartite partner (government, employers and unions) has contributed a lot to strengthen the tripartite partnership.

Government’s role is to build a globally competitive workforce and an optimum workplace for a cohesive society and a secure economic future for all Singaporeans.  

Union is generally presented by NTUC. It plays a role as a proactive social partner who works closely with employers and relevant authorities to raise workers’ skills, productivity and employability especially during the downturn.

Employers: is represented by SNEF whose vision is to be employers’ vanguard in maintaining industrial harmony in order to enhance workforce competitiveness.

Singapore’s harmonious industrial relations and overall progress, especially throughout the economic downturn has proven the success of each partner in living up to and delivered on its commitments.

3) National Shared Values

The set of common values which includes (i) Nation before community and society above self; (ii) Family as the basic unit of society; (iii) Community support and respect for the individual; (iv) Consensus and not conflict; (v) Racial and religious harmony adopted by parliament in 1991 is another key factor that motivate the collaboration among the three tripartite partners through various stages.  This has created a strong platform for all partners to share information, exchange views in order to have genuine consensus in the strategic direction.

With those shared values, the tripartite partners are committed to working together, as shared responsibility. During the difficult times, the tripartite partners worked closely together to tackle the challenges, save jobs, guide companies to manage excess manpower and provide training programs to enhance employability of workers, etc.

CRISIS RECOVERY THROUGH TRIPARTITE COOPERATION

The economic downturn provided an opportunity to strengthen Singapore tripartism. The three social partners have set up Tripartite Upturn Strategy Teams (TRUST Teams) to provide advice and assistance to companies affected by the recession to cope with the downturn and prepare for the upturn.  “Some 340 companies have expressed interest in getting guidance and advice from these teams since their formation in April”^[2]. Below are some of the key programs that demonstrate tripartism collaboration action that have been effectively implemented at various organizations to cope with the economic downturn