From April 2017, there will be a new way for workers and employers to solve salary-related disputes via the new Employment Claims Tribunals (ECT) and Tripartite Alliance for Dispute Management (TADM).
As explained by Minister for Manpower Lim Swee Say in Parliament on 16 August 2016, prior to the passing of the bill, there are three avenues for resolving salary-related disputes - through unions, the Employment Act (EA), and through the Civil Courts.
However, he pointed out that "even with these three avenues in place, there is growing demand for access to an affordable and expeditious way to resolve disputes" especially amongst PMEs
Hence the implementation of the ECT to help more employees resolve more types of salary-related disputes with their employers.
More salary related disputes will be covered
Apart from taking over the Labour Court's function of hearing statutory salary-related disputes on employee entitlements under the EA, Retirement & Re-employment Act (RRA) and the Child Development Co-Savings Act (CDCA), the ECT will:
- Hear contractual salary-related claims from employees including payment of allowances, bonuses, commissions, salary in lieu of notice and retrenchment benefits, provided that these are expressed in monetary terms in the contract.
- Hear claims - only those for notice to pay - from the employers.
Other than covering more types of claims, the ECT will be accessible to more employees including:
- PMEs who earn more than $4,500 per month and are currently beyond the coverage of the EA.
- Public servants, domestic workers and seafarers will continue to covered.
However, he noted that as per current practice at the Labour Court, contractual salary-related claims of public servants, domestic workers and seafarers will not be heard at the ECT.
How ECT works
Set up under the State Courts, claims in the ECT will be heard by legally qualified Tribunal Magistrates and in accordance with Courts processes.
Lim noted that all parties will be required to go through mediation conducted by MOM-approved mediators before their claims can be heard at the ECT.
"Our experience, shows that mediation is an effective way of resolving salary-related claims amicably between the parties. More than 90% of Labour Court claims were resolved at the mediation stage without having to go through formal hearings," Lim explained.
- The claimant must submit a request for mediation within one year after the claim arises, or within six months if the employment relationship has ended.
- There will be no legal representation, as with the Labour Court and Small Claims Tribunals.
- If mediation is successful, parties will sign a settlement agreement and apply for the registration of the settlement agreement in the District Courts for it to be enforceable as a binding Court Order.
- If mediation is unsuccessful, the mediator will issue a referral certificate for the claimant to lodge a claim at the ECT.
Lim noted that though the ECT will significantly enhance the resolution of employment disputes, tripartite partners will continue to have important roles to play.
As such, a new centre - the Tripartite Alliance for Dispute Management (TADM) - will be set up by the tripartite partners to conduct the pre-ECT mediation and serve as the MOM’s approved mediation centre for all employees, both unionised and non-unionised workers.
He added that union members will enjoy additional remedies, such as the Tripartite Mediation Framework (TMF), MOM conciliation or recourse to the Industrial Arbitration Court.
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Expanded coverage of Tripartite Mediation Framework (TMF)
In addition to the ECT and TADM, the IRA will also be amended to expand the coverage of the Tripartite Mediation Framework (TMF) so more union members can use this avenue to resolve more types of disputes.
"Today, only managers and executives earning up to $4,500 per month who are union members in non-unionised companies have access to the TMF.
"We will remove the salary cap and also allow the rank-and-file employees to access the TMF. Only executive employees with substantial managerial responsibilities will continue to be excluded due to a potential conflict of interest," Lim said.
Disputes covered under the TMF will now include re-employment and other statutory employment benefits such as over-time pay, public holiday pay and maternity benefits under the EA and CDCA.
Additionally, in recognition of the role of the unions, three features have been included in the ECT process:
- The claims limit will be $30,000 per case, for cases which go through mediation with union involvement, compared to $20,000 for all other claims.
- Union members in unionised companies can be represented by their unions at mediation and at the ECT and this will be prescribed in the subsidiary legislation.
- Union members in non-unionised companies who undergo TMF can seek consent from the ECT to have their tripartite mediation advisors observe their ECT hearings.