Singapore’s non-payment economy

Satter Abdul can still remember the day when he and nine of his colleagues pooled together all of their funds and still could only afford a loaf of bread to share among themselves.

At the time, the 10 Bangladesh nationals were working in the eastern part of Singapore, building new extensions to two primary schools, when their employer, Heng Shun Construction, stopped paying their wages.

They went unpaid for three months before seeking help from a migrant rights organization and the Ministry of Manpower. “Can you imagine the feeling of not even having a dollar in your pocket?” Abdul asked bitterly. Heng Shun did not reply to Asia Times’ request for comment on the nonpayment allegations.

Singapore, an island nation of 5.6 million with one of the world’s highest per capita incomes, increasingly relies on low-wage migrant workers for its labor-intensive industries. As of June 2016, over 770,000 migrants toiled in industries ranging from construction to marine to various low-end services, according to official statistics.

The migrants, largely from Bangladesh, India, China and Myanmar, are keen to cash in on Singapore’s higher wages, which are often sent home as remittances. They can be seen all over the island, toiling on the roads and on construction projects, riding in clumps in the back of pickup trucks travelling to their work sites.

But the promise of higher wages than they could earn at home is not always realized. Wage theft, a situation where workers are denied their contractually owed pay, is a worrying trend in Singapore, one that authorities have arguably been slow to address.

A position paper published in January 2017 by the Humanitarian Organization for Migration Economics (HOME), a local migrant rights group, details the many ways which non-payment often occurs in Singapore, including through the manipulation of basic wages, undercounting of overtime hours and the imposition of unlawful deductions and kickbacks.

Of the over 2,000 cases HOME handled between 2015 and 2016, more than half of the migrant workers suffered from late or unpaid wages. “Workers find it difficult to produce evidence and documentation, which are usually in their employers’ possession, and lack the resources to disprove falsified evidence when they are produced by their employers,” explained Jevon Ng, a case worker at HOME who co-authored the paper.

There is no mandatory minimum wage in Singapore, but local labor laws stipulate rates of percentage pay for overtime and public holidays, and put a hard cap on the amount of deductions an employer may take from a worker’s salary. The laws also stipulate that employers must continue to pay workers at their basic rate even when no work is given for a particular pay period.

This was not Rahman Anisur’s experience. After arriving in Singapore from Bangladesh, his employer in the construction industry often did not have work for him. Although his employer was obliged by law to pay him his basic salary of S$416 (US$293) a month, Anisur says he often received no payment at all. When he raised the issue, his employer threatened to send him back to Bangladesh without pay.

Anisur said he paid S$9,500 in recruitment fees to a placement agent in Bangladesh. “I came to Singapore to work and send money home to my family. I have to support six members of my family, and now I have a bank loan [because of the recruitment fees]. I want to work; it was very expensive to come here,” he said.

A range of factors give employers exceptional power over employees that leave migrant workers particularly vulnerable to non-payment of wages. Workers often pay high recruitment fees – ranging from S$3,000 to S$15,000 – to land jobs in Singapore.

Because their employment is tied to a particular employer who has the prerogative to cancel their work permits at any time, workers are left in precarious situations where any conflict with their boss could result in them being fired and deported before they have earned enough to recoup their upfront costs.

“We trusted and believed that the company would pay us,” Abdul, the Bangladeshi construction worker, said of his decision to keep working unpaid for three months. “We had to believe it because we came here to work.”

Heng Shun Construction told the Straits Times last month that its non-payment of wages stemmed from cash-flow problems. Abdul and his colleagues have since taken their case to Singapore’s Labour Court. But there is no guarantee they will receive justice due to caveats in the law that militate against migrant laborers.

“Workers who lodge their cases are not allowed to work while their cases undergo mediation, which can stretch for a long period of time,” Ng, the HOME case worker, said. “Such a lengthy and excruciating process makes it very difficult for them to sustain themselves while they fight their cases.”

Abdul lodged a non-payment claim with the Ministry of Manpower in October last year, but still has no idea when his case will be decided. If his back wages are not paid soon, he says his seven-year-old son will have to drop out of school back home in Bangladesh. “I’m not just one person. I have a family to think of,” he said.

Minister of Manpower Lim Swee Say said in a recent parliamentary session that his ministry received some 9,000 salary-related complaints from migrant workers in 2016. Over the past three years, 158 Singapore employers have been prosecuted and convicted for salary-related offences, the minister said, with penalties ranging from fines up to six months’ imprisonment.

“There is a lack of consistent enforcement to deter wage theft,” said Stephanie Chok, co-author of the HOME paper on non-payment. She notes that the conviction rate for non-payment averages around 50 per year for literally thousands of annual complaints. “As long as employers are able and allowed to profit from wage theft, they will continue doing so.”