NWC proposes 5.5% to 7.5% pay rise for lower-wage workers in new guidelines

Firms that have done well urged to give the workers a raise of at least $105 to $125

- Sharon Salim Business Correspondent

Lower-wage workers earning up to $2,700 a month should receive a pay bump of 5.5 per cent to 7.5 per cent from their bosses, the National Wages Council (NWC) said on Nov 11 in its annual guidelines on pay and employment issues.

Employers whose businesses have done well are recommended to give these workers a raise of at least $105 to $125, even if it exceeds the percentage range provided, said the NWC.

For those whose businesses have not done well, it recommended giving lower-wage workers a builtin wage increase at the lower end of the range. Further wage increases should be considered if business prospects improve.

The recommendations have taken into consideration the current economic outlook and historical median income growth of 4.2 per cent per annum between 2016 and 2024, said the NWC.

Different industries are facing different challenges. Ministry of Manpower (MOM) Permanent Secretary Ng Chee Khern said domestically oriented sectors like administrative and support services, and food and beverage services, are currently lagging in productivity.

“These sectors must press on with business transformation to become more competitive and productive. This will ensure wage growth for their workers,” he said.

NWC said employers should adopt a flexible-rate wage system to maintain wage flexibility during adverse business conditions.

This would sustain their businesses by cutting costs rather than jobs, and retain talent and allow quick adjustments of wages during an upturn.

The council also called for all employers who have not done so to implement the system in full, comprising both the annual variable component and monthly variable component.