Progressive Wage Model (PWM)

The Progressive Wage Model (PWM) helps to increase wages of workers through upgrading skills and improving productivity.  It specifies starting wages for workers according to their skill and experience levels, so workers can get higher pay as they upgrade their skills. It is implemented via government levers in the cleaning, security and landscape sectors.

 

What is it

Developed by tripartite committees consisting of unions, employers and the government, the PWM helps to uplift low-wage workers in the cleaning, security and landscape sectors.

Wages in these sectors had stagnated due to widespread cheap sourcing. The low wages in turn resulted in high turnover and labour shortages.

The PWM benefits workers by mapping out a clear career pathway for their wages to rise along with training and improvements in productivity and standards.

At the same time, higher productivity improves business profits for employers. Service buyers also enjoy better service standards and quality.

 

Who it covers

The PWM covers Singapore citizens and Singapore permanent residents (PRs) in the cleaning and security sectors, as well as landscape companies on NParks’ Landscape Company Register.

Employers are encouraged to use these principles of progressive wage for your foreign cleaners, security officers and landscape maintenance employees.

When it took effect

Employers must have met PWM requirements by the following dates:

Sector

PWM requirements took effect from

Cleaning sector

1 September 2015
Note: Wages increased from 1 July 2017.

Security sector

1 September 2016
Note: Wages increased from 1 January 2019.

Landscape sector

30 June 2016
Note: Wages will increase from 2020.

 

How it is implemented

Sector

Regulated by

Cleaning

Licensing condition by NEA

Security

Licensing condition by PLRD (SPF)

Landscape

Landscape Company Register requirement by NParks

The PWM is regulated by the respective lead sector agencies through:

 

 

Help for employers

If you are an employer, you can tap on the Workfare Skills Support scheme to offset a significant portion of the training costs for your Singaporean employees.

You can also get co-funding for productivity improvement projects through various grants in the Lean Enterprise Development Scheme.

 

Does the Progressive Wage Model also apply to part-time or temporary workers?

Yes. All cleaners who are Singapore citizens or permanent residents are eligible for the Progressive Wage Model.

Part-time workers’ wages will be pro-rated based on the PWM basic wage paid to a full-time worker with similar job scope.

Employers in the cleaning sector must pay progressive wages to be licensed.

 

Who qualifies for the Progressive Wage Model for workers in the cleaning sector?

To qualify for the Progressive Wage Model, workers must be:

  • Singapore citizens or permanent residents.
  • Working for a cleaning company licensed by the National Environment Agency (NEA).

Workers who entered new contracts starting from 1 July 2017 are eligible for the PWM wages for 2017.  

Workers who have existing contracts that started before 1 July 2017 will continue to be paid the previous PWM wages as of 25 April 2014. They must be paid the PWM wages for 2018 by 1 July 2018.

 

Key Differences Between The Progressive Wage Model VS Minimum Wages

There are some distinct features of the Progressive Wage Model that differentiates it from the traditional minimum wage model practiced in many countries:

There is no standard minimum wage across all sectors.

  • Unlike minimum wages in most other countries, there is no standard minimum wage in Singapore. As shown in the Progressive Wages Model, the minimum basic salary in the cleaning sector ($1,236 as of July 2020) is lower than the basic wage level in the landscaping industry ($1,450 as of July 2020).

It only applies to Singaporeans and PRs.

  • Progressive Wage Model only applies to Singaporeans and PRs. This means foreigners who are employed in these sectors are not covered under the Progressive Wage Model. This does not mean they are being paid below the basic wages that Singaporeans are earning. Rather, it just means they are not covered under the Progressive Wage Model.

Only specific sectors have the Progressive Wage Model.

  • This is not applied to all sectors. As mentioned earlier, only the cleaning, security and landscape sector have the Progressive Wage Model as of 2020. There is no Progressive Wage Model for sectors such as F&B or construction sector currently.

 

The Progressive Wage Model May Share More Similarities Than Differences With Minimum Wage

That said, there may be no need for that because Singaporeans who are working full-time in other industries may already be earning a decent salary. The Progressive Wage Model is meant to uplift Singaporeans and PRs who are working in low-wage industry, rather than to be dictating what should be the minimum salary across all sectors (i.e. Singapore probably doesn’t need progressive wages for lawyers or doctors).

 

While both are not entirely the same, there are perhaps more similarities than differences between the two. But more importantly, the intent of the Progressive Wage Model and what it hopes to achieve can be said to be similar to the intent of minimum wage – to ensure that all Singaporeans, even low-wage workers, can earn a decent living wage and to enjoy salary growth.