A Record Rise in Salary Claims

SINGAPORE – In a revealing trend for 2024, salary claims have skyrocketed to their highest levels since 2019, with a staggering 2.63 claims filed for every 1,000 employees. This increase reflects mounting challenges within various businesses navigating a troublesome economic landscape.

Sector-Specific Disputes on the Rise

The surge in claims can be primarily attributed to disputes within the information and communications, construction, and administrative support sectors. According to the Ministry of Manpower (MOM) and the Tripartite Alliance for Dispute Management (TADM), a total of 9,848 salary claims were lodged this year, contributing to a significant uptick in the total employment claims and appeals, hitting an alarming 11,685—up nearly 2,000 from the previous year.

Dramatic Increase in Claim Recovery

Notably, employees have recovered about $19 million in salary claims this year, marking an impressive 35% increase from the $14 million recovered in 2023—culminating in one of the highest figures seen in recent years.

Local vs. Foreign Workers: A Deeper Dive

Approximately 46% of claims were submitted by local employees, while the remaining 54% came from foreign workers. Local salary claims rose sharply per 1,000 employees, reflecting growing discontent, particularly in the information and communications sector, which has now overtaken others as the leading sector for claims.

Construction Sector Sparks Majority of Claims

For foreign employees, salary claims rose, particularly in the construction sector, which accounted for a hefty 47% of claims. MOM highlighted that many companies are struggling with severe cash flow issues—a reality leading to widespread financial distress in this critical industry.

Fast Resolutions, Yet Increased Wait Times

Despite the turmoil, around 90% of salary claims were resolved within TADM, slightly higher than the previous year. However, the duration for resolving claims has extended, with an increase in cases taking two to six months. Yet, an impressive 94% of those who lodged claims managed to fully recover their salaries through TADM and the Employment Claims Tribunals.

Wrongful Dismissals on the Rise as Well

Wrongful dismissal claims have also seen a notable uptick, climbing to 1,720 in 2024—a figure equivalent to 0.46 claims per 1,000 employees, reflecting an increase from last year. Local employees took the brunt of these claims, particularly among managers and executives, echoing the larger trends in job turnover.

Reflecting a Broader Economic Shift

MOM and TADM suggest that the rise in both salary and wrongful dismissal claims can be attributed to higher job turnover stemming from layoffs, dismissals, and the closure of businesses amidst ongoing financial challenges. Despite these issues, future workplace legislation aimed at enhancing employment standards is on the horizon, expected to roll out between 2026 and 2027.

Towards a Fairer Workplace

In their joint report, MOM and TADM have emphasized the need for flexible work arrangements and new protections for platform workers, aiming to cultivate fairer, more inclusive workplaces. These initiatives represent a pivotal step towards balancing the needs of both employees and employers amid a rapidly evolving job market.