Sitoh Sau Kuen, the assistant shop manager, was delighted to learn that she will start earning USD 230 more per month.
The 55-year-old is one of 136 low-wage retail workers with Radha Exports in Singapore who will receive increased pay now that the Progressive Wage Model (PWM) for the industry has gone into effect. She works at a ValuDollar location in Lorong 6 Toa Payoh.
Over the next three years, the earnings of around 19,000 full-time, lower-paid shop assistants, cashiers, and assistant retail supervisors will increase by 8.4% to 8.5% yearly starting this month.
Companies in the industry have until February 2023 to comply with these progressive pay rules. Failing to do so, they risk sanctions, including the suspension of their work pass privileges.
Prior to this, Madam Sitoh received a base monthly income of USD 2,019 that did not include overtime compensation. She is now making a base monthly salary of USD 2,249 thanks to the wage change, minus overtime compensation.
“With the salary increment, of course, I am happy. On top of that, I can also learn new skills to upgrade myself,” said Madam Sitoh, who wants to learn how to offer visual merchandise.
She was one of the shop employees that Senior Minister of State for Manpower Zaqy Mohamad and Minister of Manpower Tan See Leng visited recently during their visit to the Radha Exports building at Pioneer Road.
The ABC Bargain Centre and ValuDollar retail chains in Singapore are under the ownership of Radha Exports.
Along with the Progressive Wage Model for retail, this month also saw the expansion of the Progressive Wage Model to cover 19,000 in-house workers in the cleaning, security, and landscaping industries. Previously, the model was solely applicable to these industries’ outsourced personnel.
When asked if the higher employee compensation would result in higher costs for consumers, Radha Exports CEO Deepak Partab Anandani responded that every cost rise inevitably affects the company’s final retail price.
“We are trying to use our economics of scale, our direct buying strings and going to try and keep increases to single-digit percentages as far as possible,” Deepak Partab Anandani said.
According to Dr. Tan, the Singapore Competition and Consumer Commission makes sure that businesses “do not take advantage of this kind of initiative and obviously profit out of it.”
He stated that the Progressive Wage Model is the Singapore government’s strategy to improve the pay of the bottom 20th percentile of workers while encouraging and inspiring them to go for upgrading and upskilling.
“Our end objective is to significantly narrow the gap between low-wage workers and the median (in salary),” Dr. Tan said.
The Progressive Wage Model outlines the minimum wages and education needs for workers with various skill levels.
From September this year until February next year, tripartite partners will focus on educating employers on the numerous progressive pay standards.
Employers will have time to make changes and follow the rules. During this transitional period, those who don’t follow the rules won’t be subject to enforcement action.