Friday, December 12, 2008

Human Rights - Minimum Wage & Modern Slavery

I spoke about minimum wage on 13 Dec 2008 at Hong Lim Park, in conjunction with U60 group which is there to speak about Labour Rights.

Against Exploitation and modern Slavery

This topic about Labour Rights and minimum wage is not a very "HOT Topic" politically and any politicians can figure out that in a society which is dominated by a huge middle class citizens, there is really little "political points" to be gained, but potentially lots to lose in talking about it. But I believe in speaking up of what I believe as a social-political activist.

However, I feel that for a self-proclaimed 1st world country, we will have to re-examine ourselves in the policies that we set for our country. Singapore is a Republic, not some ancient feudal state where SLAVERY is the norm. As a modern society, we need to uphold a certain basic values of human decency.

The failure of Free Market Principles

The basis of our society should be built upon certain principles against EXPLOITATION and even modern slavery. All economist of free market believes that in a FREE MARKET, pricing would be determined efficiently by the market itself. Thus, they believe that minimum wage should be avoided. They also believe in fiscal distortions imposed by taxes and levies are also bad.

But the basic principles of a Free market is based on some fundamental assumptions that there are free and efficient flow of market information, labour mobility and such. It basically implies that both the employers and employees have equal standing, negotiation power and freedom of choices. This would apply to most of the middle class workers who have the power of modern information technology and mobility not only within the country's industries, but also global markets.

But for those of "Vulnerable group", such as manual labourers, cleaners and low wage earners, they lack such equal standing against employers. They lack bargaining power basically because they lack labour mobility, in both depth and scope. Thus, Free market principles could not be applied to such group of workers and the industries that they are in.

Most of the time, these people are being exploited, almost as modern slaves. Be it local or foreign workers, they are always the ones being exploited by employers.

The absurd wage comparisons

The most common reason I gather on why local fellow citizen cleaners are paid so lowly is that their employers will claim that they could employ foreign workers at "lower wages". For example, they would cite foreign maids' wage as an example, they were only paid $400 or less, thus paying cleaners $400 is "comparable".

However they did not mention that the total cost of employing a foreign maid includes Government levy ($190), lodging and meals. It could easily add up to $700 or $800 per month. Thus, taking the $400 maid's salary as a gauge to a cleaner's take home pay is totally unfair, because the cleaners have to pay for his or her own food, transport and lodging!

Maids/Workers' levies - Government Exploitation

At this juncture, I would like to talk about government levies imposed on foreign maids and workers. It is totally unacceptable to me that such high levies are applied to these foreign maids and workers.

Take maid levy for example. $190 maid levy on a maid who only earns $400! That is almost half of what the maid earns! That is ridiculous and obscene. Basically, it means Exorbitant EXPLOITATION by our very own government on other people's labour! How could a FIRST WORLD government allowed to exploit other people's labour?

Someone who favor government maid levy argued that these foreign workers should be "taxed". However, I would like to ask, even million dollar ministers are not taxed more than 22%! How could the government tax a maid that earn a miserable wage 30% of the total potential wage ($400 + $190)? Besides, maids are basically taxed through GST, 7% when they consume in Singapore.

Some argue that such levies are to ""protect local workers". But the truth is, it protects nobody as cleaners are still being exploited by their employers and their employers are not paying $590 but only $400 or slightly more than that to their cleaners.

Such high maid levy is basically a "Modern Slavery TAX", an exploitation by the government on other people's labour.

Implications of Government levies on Maid Employers

Most of the middle class maid employers would think that this issue about maid levy is none of their business. But the truth is, they are being reaped off. Let me explain using Hong Kong as an example.

In Hong Kong, there is a minimum wage policy for maids. It amounts to about S$670. They used to have maid levy about S$80 but it has been waived lately. (Contrary to Singapore, the levies collected were put into a fund to help local workers in job training.) But with such a wage, the Hong Kongers are employing more experienced and higher quality maids. Most of the time, the basic requirement is at least 3 years of working experience in Singapore.

But in Singapore, what we get are new, inexperienced and young recruits from the countries of original. And most of the time, they used Singapore as a stepping board or training ground to gain enough experience to get themselves employed in other places like Hong Kong, Taiwan or even Middle East. This is basically why Singapore maid employers always have so much problems with their maids and frequent changing of maids.

Waive the Maid/Worker Levy and set minimum wage

Some people who oppose minimum would use the common propaganda reasoning that minimum wage would increase business cost and cost of living.

First of all, not many MAIN businesses are affected by minimum wages. Most probably only construction sector and the cleaning industry would be affected. But the impace may not be big as the cost of employing foreign workers could be maintained as the same when the workers levy is being cut or waived after the minimum wage is set. Those who exploit local workers from the vulnerable group would have to up their wage accordingly and this is for the cause of prevention of labour exploitation or basically modern slavery. They should not exploit another human being of their fair wage in the very first place.

Some argue that if minimum wage is set for maids, for example, then the middle class would have to suffer higher cost of employing a maid. This may not true at all in Singapore context.

My objective is to eradicate modern slavery, not only by the employers but also the government. Cut down the maid/worker levy to the minimum (maybe $20) or even waive it totally. At the same time, set the minimum wage at the total cost of employing a maid, i.e. $590.

This would mean that the total cost of employing maids would be the same for the middle class employers. And it not only prevent the government of modern slavery but it further prevents exploitation from other employers.

Who gain the most? Not only the maids or low wage foreign workers gain, but local citizens who fall in the vulnerable group will gain too. On top of that, the middle class maid employers would gain by using the increased maid's wage without increasing their cost of employment, to employ more experienced maids. They could demand maids that have worked in places like Malaysia or other places for at least 3 years.

Who would be the loser? The government. Well, if the government is unfair in applying such taxes or levies without diverting such money for the benefits of local workers, then it deserved to be cut from such UNFAIR and IMMORAL revenues.

Goh Meng Seng

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