A one-of-a-kind union that rejects minimum wage
Inspiring great confidence in the union
Every good party needs a clown to provide the laughs, and it was Zorro Lim (not his real name) on the PAP roster yesterday.
At the Budget debate, NTUC Secretary-General Lim Swee Say rejected renewed calls by several MPs, including Inderjit Singh and NMP Lawrence Lien, for a minimum wage system. Instead of speaking up for the workers that he is supposed to represent, he is strangely the one voicing the objection, even if we know all along that the government is never keen on the idea.
This must be an absolute one of a kind. Nowhere in the world will you ever find another union chief who argues against higher wages for workers.
As mentioned in the above linked report, more than 90 per cent of countries have some sort of minimum wage. But Zorro thinks we have a system better than all these countries. Instead of a straightforward policy, he prefers convoluted wage supplement systems that go by indistinguishable acronyms like WIS, WTS, WTF, etc.
“With the WIS, WTS and Progressive Wage Model, we believe we now have a minimum wage model. In fact, it’s more than a minimum wage model whereby we can maximise the upside of low-wage workers and at the same time minimise the downside,” was what he said.
If you can’t convince them, confuse them — as what Zorro did here with this laughable smoke bomb he has thrown. He must have left the MPs still scratching their heads at the end of the session as nobody could possibly grasp what he’s on about.
A list of countries with minimum wage on Wikipedia shows that even in countries that don’t have a national minimum wage, there are minimum levels set by collective bargaining agreements. The NTUC, on the other hand, is as reluctant as the stingiest employers when it comes to recommending wage increments. Zorro will be proud that he is in the company of a very select group of countries consisting of the likes of Somalia, Tonga and Yemen.
Without a doubt, there are pros and cons to having a minimum wage, and it is an endless debate that even economists can’t agree on. But when the majority of countries, especially all the first world countries, have such a policy, one would think that there must be more right than wrong with it.
The bigger problem in Singapore, however, is not this debate on the merits of a minimum wage itself. The problem is the role of the union and these so-called Labour MPs, as how the mainstream papers describe the likes of Zorro and MP Zainal Sapari who are involved in the union. It is a term that gives them way too much credit.
Over the past two weeks, netizens have lambasted leaders of business and restaurant groups for their lobbying against the tightening of foreign worker supply. Even if we criticise them for engaging in their usual scare tactics, we must realise that they are doing this to protect the interest of their members.
Similarly, it is normal for MPs and NMPs to speak up for the different groups they represent, whether in an official or unofficial capacity. For example, MP Halimah Yacob touched on Malay issues before she became Speaker of Parliament, while NMP Janice Koh speaks for the arts scene. Yesterday, NMP Tan Su Shan warned against excessive curbing of talent flow, which is not surprising given her private sector role as a DBS Group Head. Everyone plays his part to ensure balanced representation in parliament.
Everyone except our union chief.
And that is why we have problems of suppressed wage levels and an increasing income gap. On one side, we have business groups and pro-business MPs lobbying for the SMEs, but on the other side, there is no one to fight for the workers. It is as lopsided as it gets.
Of course, we know the government wants the union in check, and Zorro is there to do just that. But is it too much to ask that he speaks up for workers once in a while? Can he at least pretend he has their interest at heart?
Voiddecker
Unfortunately Singapore is a price taker and there are little legal things such as FTA and CECA or WTO or etc which does mean something legally and a large foreign worker population.
There will be a big outcry if the FDWs and FWs in the industry are paid the minimum wage . further, a lot of countries do implement socialised welfare and are paying the price of entitlements.
As the saying goes “it is very easy to start a govt program but not so easy to kill it”.
You may say Malaysia or HK has done it but there was huge outcry domestically if applies to all FWs , they had to restrict it by occupation which makes it a bureaucratic nightmare which also created a diplomatic brou ha ha (HK got off easy as it is now SAR , Malaysia has its own issues and does not “need” Indonesia or Phillipinnes)).
VAT is another nightmare in UK but thats another story and apologies , need to work and only so many hours in the day
From reports, HK seems to be have handled the transition pretty well, while the verdict is still out on Malaysia.
But my issue here is not the minimum wage itself. It is the union. I can understand if, say, the Minister for Trade & Industry argues against it, or other pro-business MPs, but something is seriously wrong if it’s the union chief who does it. If you take on a role, you must do what you should do instead of defending the system. Shows how screwed workers are.
Voiddecker
You forget that the system in Singapore is tripartism and not the adversarial system found in other countries.
Further, the minimum wage principle basically disenfranchises those starting out rather than those in the system working itself.
Hence, that is why people end up interning for free.
“Further, the minimum wage principle basically disenfranchises those starting out rather than those in the system working itself.
Hence, that is why people end up interning for free.”
Please provide data or research to back up your assertion. Otherwise, it is just your personal opinion, to put it politely.
Xmen
All you need to look at is the youth unemployment issues in all countries under severe economic stress at present.
Hence, refers to that in my comments.
Further, let me throw this back to you where are your own studies.
Even in UK, just look at the comments/publications even in the Economist, HBR that there is a youth issue.
A minimum wage can easily be a a maximum wage than especially in the slow growth economy.
Xmen
Apologies.
Please read the studies by Cato Institute or AEI on
youth unemployment which
one example
The Negative Effects of Minimum Wage Laws
Mark Wilson September 2012
Further, it is logical as why would a employer hired an inexperienced person as compared to an experienced person.
I will grant you that in an economic tough time, wages (minimum or otherwise) can be a factor in (un)employment. Take Spain for example, the youth unemployment rate is over 50%. That looks bad until you realize that the overall unemployment rate is also extreme at 26%! I don’t think you can attribute the high unemployment rate to minimum wage alone. The root cause of high unemployment in Spain is their uncompetitiveness. In the old days, they could have corrected the situation with devaluation but it is not possible today.
Anyway, I just want to point out that your minimum wage argument is a weak one. Almost all developed countries and some developing countries have decided to implement minimum wage after rigorous studies and analysis of costs and benefits. In the case of Singapore, the liberal immigration policy complicates the matter further. But I would argue that if Singapore cuts back on labor imports, wages will rise measurably for low- and middle-income workers. So if PAP insists on importing labor (which suppresses wages), it is only reasonable to impose a minimum wage to compensate for wage loss by foreign competition.
Xmen
Than explain why youth unemployment is almost double that of the country’s overall unemployment.
So yes it does disemfranchise those who are youth under minimum wage.
For your points on importation of labour, do not disagree but you do realise that MNCs make up a major part of the GDP and with new technology although I disagree with the one sided views of Alex Lew, the key point remains, there will more and more outsourcing which will basically result in more non-wage movements.
whether the labour is in singapore or not.
At the end of the day, the geographical constraints remain which is Singapore is one of the smallest countries in the world.
Frankly, your argument that just because a lot of developed countries have minimum wage is frankly disingenous and weak, they have different sets of problems and considering that the chickens have come to roost on the set of eggs, that argument is even worse.
What most economist state is that there should be more tax credit or state support to incentives work , however, for singapore, the key issues is that the cash component should be tweaked.
I did mention that it’s an endless debate
Voiddecker
thanks to Cynical Investor and highlight on this article which best captures
http://www.economist.com/blogs/democracyinamerica/2013/02/minimum-wage
This is best encapsulated
“Perhaps it’s wishful on my part to think, as I do, that most economically literate observers really do understand that raising the minimum wage will screw up the prospects of a fair number of poor young workers. Those who favour raising the minimum wage anyway just think that, all things considered, that’s a price we ought to be willing to pay. But they can’t say that, just as second-amendment enthusiasts can’t say that an occasional grim harvest of kindergartners is a price we ought to be willing to pay for the freedom to own guns. One of the most maddening things about political debate is that it’s rhetorical suicide to accept tragic trade-offs. So one must deny that there are trade-offs. It’s got to be all benefit, no cost. And that’s why we find so few willing to step forward and say, yes, “minimum wages pose a tradeoff of higher wages for some against job losses for others”, but let’s raise the minimum wage anyway, because, in the final analysis, the benefit to those who enjoy higher wages will be greater than the cost suffered by those put out of work, and this distribution of burdens and benefits is not too unfair to stomach.
I dearly wish somebody would say this, because then we could go on to have a useful, meaty debate about the mix of policies most likely to succeed in helping low-wage workers”.
The conclusion seems to follow LSS but what the heck will leave at that point there on the tradeoff issues
As I commented on Cynical Investor’s post, I don’t think the economist article itself adds much to the debate, but is merely stating the author’s view. Maybe it’s in the various links but I’m too lazy to go read them all
And the author contradicted himself with the 2 statements below.
“Those who favour raising the minimum wage anyway just think that, all things considered, that’s a price we ought to be willing to pay.”
we find so few willing to step forward and say, yes, “minimum wages pose a tradeoff of higher wages for some against job losses for others”
the comment “need”means not dependent on the resources of those countries other than labour
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In this alternate universe, the Union Chief is appointed by the boss, not elected by the members. Under the leadership of the UC, you have witnessed stagnant and even negative real wage growth over the past decade. At the same time, the boss is flushed with cash and is enjoying the limelight.
Mark my words, this will not last.
I like your new scheme – WTF!!!
What the fcuk, they may just come up with WTF – Workfare Training Fund.
It’s the only way anyone can remember all these 3-letter schemes!
Once you have a government linked union with leadership appointed by government, it’s no longer a proper union, conflicts of interest there.
The reason why our workers are not productive, there is no one there to appropriately fight the just cause when the going gets rough, workers simply gave up improving themselves.
He only likes to see people suffered. He will not adopt any ideas that will improve people lives. He is a psychopath minister. Politicians all have psychopath tendencies. The only difference is the intensity. Vote opposition not the psychopath party.