Note from transferring agency: The following file has been declassified. MOM has checked the file, and find that the file does not contain any explicit record that MOM’s powers under Part XII of the Employment Act have been invoked in obtaining the information. As such, the bar from publication or disclosure under section 102 of the Employment Act does not apply.
This file, dating from 1979 to 1994, documents the events surrounding several important milestones in the history of the National Wages Council (NWC) wage recommendations. In particular, it contains:
i) statements by the Ministry of Labour (MOL) in 1979 and 1980 in response to the NWC wage recommendations. In the years between 1979 and 1981, the NWC recommended high wage increases as a means to restructure the economy. The MOL statements explained the need for such a policy as Singapore had become increasingly reliant on foreign workers - the inflow of which had been intended only to ease short-term labour shortages.
ii) monitoring reports on the implementation of NWC wage recommendations in 1985, 1986 and 1987. In 1985 and 1986, in particular, Singapore's economy underwent a recession. While the NWC had recommended a wage increase in 1985, many unions agreed to forgo the NWC wage increase to help the companies cope. In 1986, the labour movement led by NTUC further agreed to reopen wage negotiations to allow for a wage freeze even though wage increments had been secured in their collective agreements. The outcome of the goodwill by the unions resulted in a significant 61% of companies implementing a wage freeze that year.
iii) policy papers in the mid-1980s on whether the NWC should continue to provide wage increase recommendations. This followed from calls from certain employer segments for NWC to be dissolved and for a return to wage negotiation based on market forces and between the companies and the unions. MOL's assessment was that the NWC's quantitative wage recommendations had reduced the prevalence of wage disputes, and any reform if needed, could be in the representation of the NWC and nature of recommendations. The issue of whether the NWC still had a role was subsequently also discussed by NWC Chairman in his 1994 interview with the Business Times.
Jan 1979 - May 1994
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