Hiring PMEs – What It Is And How This Will Affect Your Firm

What is a PME?

The acronym PME is short for Professionals, Managers and Executives, whom the Ministry of Manpower defines as workers who have achieved the education qualification of a diploma or above, as well as those workers who have been employed as professionals, managers or executives and have had work experience is similar positions.

 

Advertising Requirement For Hiring

In compliance with the Fair Considerations Framework’s job vacancy advertising requirements, organisations have to publish the salary range of a job being advertised in the Job Bank. Failure to comply will result in the rejection of Employment Pass applications for those recruited for positions whose salary range was not stated in the advertisement.

Organisations that are known to have very few Singaporean PMEs will be subjected to close scrutiny of their recruitment process to determine if Singaporean applicants were fairly considered. They may be required to provide information on the number of applicants, how many, if any Singaporeans were interviewed for the position, as well as the number of Singaporeans currently employed in the organisation at varying levels of management.

As vacancies come up, organisations are being urged to be impartial towards Singaporean applicants, and vet them fairly based on merit.  As of 1 August 2014, before an Employment Pass application is submitted to the Ministry of Manpower, the relevant job vacancy announcement needs to

  • Be advertised on a new jobs bank administered by the Singapore Workforce Development Agency
  • Be open to Singaporean applicants
  • Comply with the Tripartite Guidelines on Fair Employment Practices
  • Run for at least 14 calendar days

The benefits of advertising on the jobs bank are numerous and range from giving employers access to a larger pool of prospective applicants, improving the ability to match the right applicant to a vacancy, as well as making it possible for more Singaporeans to have access to the information on the advertisement of available jobs.

It should be noted that there are some exemptions. For example, smaller firms with 25 or less employees are exempted from the advertising requirements listed above. Also exempt from these same requirements are jobs with pay a monthly fixed salary of $12,000 and above.  Nonetheless, should any complaints be made about these small firms with regard to nationality-based or other discriminatory HR practices, they will become subject to additional scrutiny and may have their work pass privileges revoked.

 

Recent Changes (Enhanced Support For Singaporean PMEs)

In an effort to strengthen the ‘Singaporean Core’, there has been increased focus on developing and growing the tertiary education profile of the local workforce which will in turn generate an economy that is comprised of quality jobs where employees are highly skilled and innovative.

 

1 - Hiring and Training of New Recruits

In industries where there is an insufficient number skilled Singaporeans, a program to implement skills transfer from a foreign skilled workforce over a specified period of time has been put in place. Foreign PMEs will be vetted to ensure that they have the appropriate skills, qualifications and matching educational background to fit the jobs they are applying for before being plugged into workforce. The Ministry of Manpower has stated that they will “ban applicants with forged qualifications from working in Singapore for life. They will also reject work pass applications which contain doubtful qualifications such as those from degree mills.’

Firms have to be fair in the recruitment of Singaporeans over foreign PMEs (see recent updates where qualifying salary for Employment Passes for foreign PMEs are raised). The recruitment of foreign PMEs should only be done when it has been determined that there is no local PME who can meet the requirements for the position. As mentioned earlier, the foreign PME hired to fill any advertised positions must be candidates of suitable experience with genuine qualifications, with the willingness and ability to pass their skills onto their Singaporean counterparts and in effect empower them.

Organisations are now required to provide on-the-job training for any new recruits. If it is not possible to provide on-the-job training, then the organisation will have to organise for the new employees to participate in external trainings that will equip them to meet and surpass the levels of experience required to perform the job to a satisfactory standard.

 

2 - Harnessing the experience of Mature PMEs

The economy of Singapore is rapidly changing, and there is a strong need for the existing PMEs whose expertise is slowly becoming obsolete to find ways to either remain relevant in their industries or shift their skills to adapt to other industries outside of their current domain. The Singapore Workforce Development Agency aims to reach out to PMEs through various outreach programs such as workshops, career counselling, and career fairs aimed primarily at the those PMEs who are in the middle of their careers to guide them through this process.

Skills conversion for mature Singaporean PMEs is a more deliberate process because, although they may possess a wealth of experience, placing them in the current market is a challenge. Processes and technological advancement of the various industries as well as the abilities and attitude towards adaptability of the individuals has to be taken into consideration when placing mature PMEs. Incentives in the form of wage support ranging from 10%- 40% are provided for employers willing to employ mature workers. Preference is given to mature PMEs who have searching for a mid-level job with a salary of at least $4,000 for at least six months without success.

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3 - Increased Access To Dispute Resolution Mechanisms For PMEs

In the past, PMEs who earned over $4,500 were not covered by the Employment Act had no way of resolving their statutory and contractual salary-related disputes through adjudication. Starting the first quarter of 2016, the Employment Claims Tribunal (ECT) set up by the Ministry of Manpower would facilitate such process, where PMEs will be able to forward their complains to the tribunal for resolution.

The Tripartite Mediation Framework made up of tripartite partners have come together and agreed to handle re-employment and employment statutory issues, to remove the salary cap of $4,500 to cover all PME union members regardless of the organisation they work for, and to include rank-and-file union members in non-unionised companies.

 

Keep Abreast Of The Latest Manpower-Related Information

Ever-changing employment practices might have various degrees of impact to your business, sometimes in form of additional subsidies such as additional training budgets but occasionally there are additional regulatory requirements to adhere to. When in doubt, it is advisable to speak with your trusted consultant.

 

More about funding for your Singapore business

 

Want to know more about taxation for Singapore companies and funding available to Singapore businesses? Refer to our guides below.

TAX APPLICABLE TO SINGAPORE BUSINESSES

POPULAR GOVERNMENT FUNDING FOR CORPORATES