Does Singapore Have a Bona Fide Labour Union?
26 July 2003
As I read Mr Tan Tarn How's article this morning in the 26 July 2003 issue of
the Straits Times (attached at bottom), several thoughts flashed through my
Until recently, the need for a strong labour union has been taken very much for
granted. But with growing retrenchments and unsympathetic policy makers, the
need for a bona fide union who will stand shoulder to shoulder with the worker
is absolutely necessary.
In Singapore, the lack of bona fide union representation is all the more
glaring given that this is not a welfare state and the state does not provide
any relief for the unemployed. The government's clear message to the retrenched
worker is not to look for free "hand-outs" (quoting the words of Straits Times
writer Ms Chua Lee Hoong).
Does asking for a descent job qualify as a "hand-out". I think that the average
Singaporean only wishes to be given the opportunity to earn his keep, and it is
not his fault that he has fallen victim to an imperfect system. (Pls see
previous article "Job Market Imperfections? Live With It!!! in previous issue
of Singapore Review, attached below)
And adding insult to injury, not only do policy makers remain unsympathetic to
displaced workers, unemployed workers are also denied of their hard
earned CPF salaries. If this is not the time to dip into hard earned savings,
It is understandable that many workers are bitter and feel that Unions here are
government affiliated and will only make a 1/2 hearted attempt to fight for
workers rights. Most often the measures are limited to retraining and job
sourcing unlike real Labour Unions in France and South Korea who have little
fear in going toe to toe with ministers and government on serious bread and
butter issues concerning employment and wage reforms.
But what do you expect when the unions in Singapore are largely runned and
managed directly or indirectly by officials who retain strong ties with the
government (and ultimately employers).
In Singapore, so called "Labour Unions" like NTUC are seen as tools for the
government to implement unpopular wage reforms. The relationship is a symbiotic
one and therein lies the problem. There will come a time when the needs of the
workers are at odds with government wage reforms and this is precisely the time
when real labour unions come into play.
It is no strange coincidence that the NTUC chief has always been a PAP member
and a member of cabinet. The dilemma that poses then is what happens if there
is a conflict of interest between workers and cabinet/policy makers?
Unfortunately, public consensus here confirm that when push comes to shove,
these pro-government unions will not be there in the darkest hour of need.
In short the pathetic state of labour union representation in Singapore is much
like that of opposition politics. Whatever protests and representations allowed
via official channels are merely cosmetic in nature, more so to show case to
the world that individual rights are represented in form and on paper. When the
question is asked, the government can proudly respond and answer, "Yes, we have
a labour union in existence here to represent workers rights and workers do
have a channel to make themselves heard."
And it is conceded that this is the truth on paper at least.
But peering beyond the veil, the real scene that greets the eyes is far from
encouraging. It is an ominous reminder that here in totalitarian Singapore, the
Government controls everything, and we mean everything literally.
In these difficult times, where there is a growing divide between the interests
of workers and the interests of the Ruling Elite. The absence of real, tangible
dissent in opposition politics and labour representation is both conspicuous
Events in recent weeks have emphasized the growing discord between the
interest of the masses and those of the Ruling Elite. Singapore Review has been
flooded by passionate letters endorsing release of CPF funds during these
difficult times. Other issues which have attracted passionate response concern
the NEL Fiasco (and repeated calls to open Baugkok station) as well as looming
unanswered questions concerning ministerial salaries.
Cruel Irony Defined: A PAP Minister who takes home SGD100,000-SGD175,000 PER
MONTH in tax dollars telling a worker (who earns SGD2,000 a month) to be "less
choosy" and to work harder.
And unfortunately for the average Singaporean, the above scenario has been
replayed over and over again like some defective recorder. After awhile, even a
once intelligent mind becomes numb and accepts fiction over fact and form over
This ridiculous situation exists only in Singapore as there is no real barrier
(whether in the form of real Labour Union representation, or Opposition
Representation) standing between PAP ministers and average individuals.
Is this a political system that is FOR THE PEOPLE, BY THE PEOPLE AND OF THE
PEOPLE? One really wonders.
WHAT HAPPENED TO THE CONSTITUTION?
The merits of a One Party, One Government, and totalitarian dictatorship have
long been questioned. The word of Kennedy strike home "POWER CORRUPTS AND
ABSOLUTE POWER CORRUPTS ABSOLUTELY". The spirit of these words govern the
Doctrine of Separation of Powers in a written constitution. One wonders in
Singapore whether the constitution exists only in form and not in substance. As
is often the case in Singapore, the spirit and original objective is often lost
in a model system that looks good only on paper.
By: Tan Tarn How
INSIGHT: Labour pains
THE labour movement is in the throes of some angst, two events over the past
First, union leaders have come forward, as if in a collective throwing up of
hands, to bemoan publicly the spot they are in.
Witness on Wednesday, for instance, Singapore Airlines Staff Union's R.
Mohanadas telling the Senior Minister that the layoffs of 63 Singaporeans from
SIA Engineering Company - while the foreigners stayed on - had cast doubts on
the union's effectiveness.
'You know how difficult it is for us to explain to our members?' he asked at a
dialogue during the labour movement's powwow to prepare for a strategy-setting
conference later this year.
'They ask, 'Why are we paying dues to the union when it can't even protect our
rice bowl?' '
Then there were Singapore Insurance Employees' Union chief Terry Lee and Mr
Philip Goh, executive committee member of National Transport Workers' Union,
lamenting the day before at the same event that many workers think they are pro-
management, and talk like management.
The latter added: 'We are very unpopular. We are demoralised. We don't know
what to say.'
If these cries of dejection are anything to go by, workers with the threat of
the axe hanging over them seem to be telling their unions they are losing faith
in their representatives, and saying so loud and clear.
Union representatives have in turn lashed out at their top leadership. At this
week's meeting, Mr Max Lim, general secretary of the Singapore Bank Employees
Union, for instance, rapped NTUC chief Lim Boon Heng for saying there was
nothing much unions can do if profitable companies chose to lay off workers.
In Singapore's labour movement, where solidarity and closed-door manoeuvring
are the bywords, the public ticking off is unprecedented, and perhaps
demonstrates the depth of the unionists' despair.
What has brought on the restiveness? Do the complaints show that unions are
fighting a losing battle with winning over workers? If so, how can the unions
remain relevant amid the wrenching economic changes?
The seeds of disillusionment, one could argue, were first planted in February
by the layoffs at the PSA Corporation.
That retrenchment exercise took on a symbolic significance, signalling for many
that the old rules - in this case, the iron rice bowl of the Government and the
government-linked sector - no longer apply.
Since then, job cuts elsewhere were to throw out other long-held notions about
the appropriateness of retrenchments. Noteworthy are the shedding of 3 per cent
of staff by Singapore Press Holdings in June, even though it expects to make a
profit this year, and SIA Engineering Company's job cuts last week, although it
had earlier got workers to accept wage cuts and compulsory no-pay leave.
And lately, the feared words 'pre-emptive layoffs' have been used for the first
time by Cabinet ministers. Layoffs, they warned, need no longer be used only as
a last resort and are acceptable even when companies are in the black.
Pre-emptive retrenchment, as advocates argue, is a result of globalisation and
the ever shortening business cycles.
It has been most widely used in the United States - the capitalist and
corporate haven. Since the late 1980s, companies there have reacted to
increasing global competition by downsizing, restructuring and outsourcing to
maintain and boost profits.
Indeed US multinationals have brought these practices here. NTUC deputy
secretary-general Matthias Yao told Insight: 'Unionists from the manufacturing
sector, exposed to the global market for years, have coped with the ups and
downs through the years, and managed retrenchments.'
What is different this time, is that the services sector is also being exposed
to the forces of globalisation as services can increasingly be outsourced,
thanks to new technology.
So the people in the services sector 'are coping for the first time,' said Mr
Yao. 'Thus their reaction is understandable.'
The nimbleness shown by US corporations in seizing technology to tame global
labour and conquer markets have helped the US outpace countries where unions
are powerful enough to block these kinds of layoffs.
Mr Lim Boon Heng noted, for example, that resistance to pre-emptive layoffs by
French and German trade unions forced companies to take their factories
overseas where they have more room to hire and fire - that is, to react to the
quickly-changing business environment by slashing costs through job cuts.
So while some jobs are saved in the short term in these countries, fewer jobs
will be created for other workers in the medium- and long-term.
The Financial Times reported last month that Germany's inflexible labour market
has been a powerful incentive to invest elsewhere.
The consequence: Last year, Germany grew by 0.2 per cent, while France managed
1.2 per cent and Spain 2 per cent.
Hence the evidence seems to be that a flexible labour market, with hire-and-
fire practices an accepted norm, boosts overall economic growth. However, the
jury is still out on whether or not downsizing or right-sizing - the euphemisms
used for pre-emptive retrenchments - work for individual companies.
A much-quoted 1996 paper by US academic Thomas Hickok said: 'By some measures,
downsizing has failed abjectly as a tool to achieve the main raison d'etre -
Between 1985 and 1990, less than half the firms which downsized to cut costs
actually reduced expenses, he wrote.
But the point is this: Whether it works or not, the trend seems irreversible.
It has also changed the nature of relationships between companies and workers.
Temporary workers, part-time workers, contract workers - they are the wave of
These types of workers are cheaper, draw fewer benefits and enjoy less
protection under the law.
Said division manager Eve Lim of recruitment agency GMP Technology: "For the
same job, they are usually paid less, and at most equal to full-time workers."
No wonder there has been a surge in the US, with temporary and contract labour
services accounting for US$13.1 billion (S$23 billion) in the first quarter of
this year, up by 5 per cent over the same period last year.
Similarly, in Singapore, the number of temporary workers rose to about 37,000
last year, a 50 per cent jump over four years earlier.
What is the consequence of these trends?
Mr John Challenger, chief executive officer of Challenger, Gray and Christmas
Inc, a US-based international outplacement consulting firm, said in a USA Today
article last November that the old social contract between company and worker -
'long-term, even lifetime, employment' - is dead.
Here too, the $150 Seiko watch for 25 years of service in a company - an icon
for the older Singaporeans - will become a thing of the past.
Dr Hickok agrees, noting that the employer-employee relationship has moved away
from long-term and stable in the direction of short-term and contingent.
Power has shifted away from rank and file employees towards top
management/ownership, and working relationships have changed from
being 'familial' towards being more competitive.
If Dr Hickok and like-minded observers are right, what does it mean for unions?
First, some facts about unions internationally.
Studies show that in many developed countries, they have grown less powerful.
This occurred most dramatically in the US and Britain in the late '80s where
former president Ronald Reagan and former prime minister Margaret Thatcher
scored major victories over organised labour.
Today, only 13 per cent of American workers are unionised - the lowest level in
Even the all-powerful German unions have lost membership in droves, and
political and social influence.
In Singapore, unions have stemmed the slide so far.
Mr Lim Boon Heng told Insight: 'Our union movement is one of the very few in
the world to have a rising trend in membership. That is an indication that the
workers find membership in the unions more useful, not less.'
Will that continue as unions face a change in their traditional role?
Professor Chew Soon Beng, a labour economist, answered the question
thus: 'There are two models for unions. One is to maximise wages like how the
US does it, and the other is to maximise employment which was what Singapore
unions were doing, but now can't do.'
The relationship between the unions and workers has changed, he said.
In the past, in an employment-driven economy, the role of the unions was clear:
protect against retrenchments.
But the cost-cutting trends of today mean that 'the role of the unions now is
to help firms survive by allowing them to do both - retrench and cut wages - to
'This is more important than maximising employment and wages.'
Mr Max Lim of the banks' union agrees: 'The most important thing is that we
must try to create an environment whereby companies will maintain
competitiveness and create new jobs.'
As unions overseas lose their membership, they are trying to find new
legitimacy by helping to shape public policy, such as welfare reform and
fighting workplace discrimination.
They do so through their political partners, and thus, in Germany and Britain
for example, unions wield influence because political parties depend on their
support. They give their support in exchange for concessions.
In Singapore, the labour movement has seen its role in the symbiotic
relationship it has with the Government, as one of helping to carry the ground,
bringing on board workers.
The NTUC chief has always been a People's Action Party member and a member of
Observers see the outpouring of angst at the labour meeting last week as the
inability of the unions to do their traditional job.
NTUC president John De Payva sized up the enormity of the task when he said the
notion of layoffs by profitable companies was 'something the man-in-the-street
can never begin to comprehend'.
Even as unions now try to push for a more flexible labour market with flexible
wages that are performance-driven, rather than seniority-driven, sceptics are
not convinced these are strong reinforcements against job loss. Flexible wages
are supposed to help companies cut costs to stay on top and save jobs.
However, Prof Chew said: 'But now, even profitable firms are laying off workers
to cut cost, instead of reducing wages.'
But the Government would argue that without wage reforms, the cuts would be
Mr Matthias Yao said unions have no choice but to press on: 'The labour
movement's role must then be to explain these new realities simply and ensure
that layoffs are carried out fairly and workers get their just dues.'
Job placement and training will also feature more, he added.
After all, the new mantra is that the only protection against retrenchment that
workers can have is their skills.
But whether that will make people sign up as members remains to be seen. As
Prof Chew said: 'Unions can no longer offer protection to workers like in the
He sees the role of unions as increasingly social, noting that many workers
joined unions in the past not so much just for protection but more for the
social benefits. 'Now, with less protection, they will need the social benefits
Mr Terry Lee from the insurance employees' union agreed that maybe the future
lies there with unions helping members during difficult times, by ensuring low
prices through cooperatives such FairPrice and NTUC Income. 'As a labour
movement, our co-ops have done a tremendous job. See the discounts given during
the Sars epidemic.'
Perhaps the NTUC is on to something, for even in New Zealand, embattled unions
are doing the same. There the National Business Review reported: 'Today's
unions use methods unheard of a generation ago to win and retain their members'
loyalty, including discount purchasing schemes and provision of credit cuts.'
So the soul-searching is on, not just for unions elsewhere but also for those
under the umbrella of the NTUC. Indeed, the NTUC will be holding a conference
in October to chart directions for the labour movement in the next three years.
It has its work cut out.
12 July 2003
JOB MARKET IMPERFECTIONS? LIVE WITH IT!!!
An analysis of Labor Department data by EPI found that in 2002, 18.1 per cent
of the long-term unemployed had college degrees, up from 14 per cent in 2000.
Similarly, 20.1 per cent were from the executive, professional and managerial
category, compared with 14.2 per cent in 2000.
With no viable solutions available from Singapore's highly paid ministers, the
only respite to the current economic gloom is a quick recovery and turn around
of the US economy. Otherwise Singapore's next batch of PHD and MBA scholars
will have employment selling char kway teow or flipping burgers in Mac-Donald's.
In today's issue of the Straits Times (see below), Lydia Lim's article reads;
"SLOWLY but surely, reality is sinking in in the psyches of out-of-work",
"NIGHT SHIFT? NO PROBLEM", "FROM CORPORATE BANKER TO DIAPER CHANGER".
Reading between the lines, it seems that local papers are endorsing this dismal
state and telling readers and Singaporeans to accept and live with this
The startling fact is that with a worsening economy and soaring unemployment
rates, there is an over supply of middle management professionals who are now
forced to compete for lower tiered jobs with fresh graduates and non-graduates.
With the current economic situation going from bad to worse, there are already
many examples of overqualified professionals who are forced into menial
enterprise. Many become cab-drivers or hawkers to tide over the bad times. Did
these professionals spend years in university just to be security guards,
waiters or cab drivers?
From an economic perspective, education is a scarce resource and there is huge
amount of wastage in terms of unutilised skills and talents.
What is even more amusing is the latest attempt by the local papers and mass
media, to glorify such cases (see also 12 Jan 2003 issue of the New Paper "From
banking man (earning five-digit monthly pay) to Golden Mile nasi lemak man
Does the current system work, or is it making an already bad unemployment
situation, even worse? Only in Singapore do we have a government that is so
engrossed with the accumulation of paper qualifications, that they have long
since forgotten the original objective behind the education system, and have
instead identified the means as an end to itself.
In their blind pursuit of their version of a utopian society, educational
elitetism takes center stage above all else, eclipsing the actual needs of the
labour market itself. The distortions in the demand and supply chain is most
acute in industries that are dominated by State Owned Entities and Government
Linked Companies who are also affectionately known by locals as "Scholar Havens"
This growing number of graduates employed in menial labour is not something to
be proud of. It is a sign that the system is not putting scarce and valuable
resource to good use. What is even more appalling is that instead of
acknowledging this defect exists in the system and looking for solutions to
address the problem, policy makers and local papers are telling unemployed
professionals and graduates to "live with it".
Unemployed professionals are told that it is "imperative for those out of work
to follow the lead of their more enlightened counterparts, who dared to say:
Social status be damned, I need a job." This totally avoids the crux of the
The underlying issue here is that due to the inability of the domestic economy
to generate higher echelon jobs, and a very weak employment market, graduates
(and Professionals) are often unable to find jobs in positions that they were
academically trained for.
This is not a failing on the part of the individual, but rather a failing on
the part of the system, and yes, ultimately the government. And a necessary
step in addressing this defect is to acknowledge that it exists and needs to be
But then again, in Singapore it is far easier to change a person's mindset and
expectations, instead of finding an actual solution to a worsening problem. And
policy makers here have elected the easier and more convenient route.