Incentives To Wean You Off Cheapsourcing

At the last management council meeting of the last year at my condo, we were presented with a request by the cleaning company for a 20% contract fee hike. The managing agent then presented us with three other quotes that hovered around the old fee mark. We opted to terminate the incumbent and go with the cheaper one. 20% was just too much.

The contractor gave the usual reasons – gahmen tightening supply of labour, and the mandated progressive wages about to hit the industry.

The Progressive Wage Model did indeed ‘hit’ last month, in a better way than I thought – in an incentive (basket, early nair say) worth a total of $5M for buyers of services – meaning we could’ve stayed with the old cleaning company, and NTUC’s Progressive Wage Incentive would’ve foot part of the bill.

That’s a nice cushion for buyers since it is now compulsory for cleaning companies to implement the Progressive Wage Model – Lim Swee Say’s betterer version of the minimum wage. Cleaners will now have better entry pays (at least above $1,000 per month), with clear pathways to higher pay based on work experience, skill upgrading and productivity improvements.

That, together with other grants (from the e2i) means that outsourcing industries like cleaning companies and security businesses can look at vendors of machines, systems and services that improve their productivity so they can provide the same level of service for clients without having to jack up prices 20% all of a sudden. (Which, in the words of a member our management council – “wah lao, one time so high, is too much”).

I also sat through a particularly dry presentation (sorry ah, presenter) by the Changi Airport Group during the Best Sourcing Symposium at the e2i, and managed to glean something – that with passenger number increases over the last five years, the adoption of best sourcing practices has somehow managed to keep the contract cost and number of cleaners relatively low while maintaining cleanliness standards.

There are ways for companies and buyers to bite the bullet and shift towards a more productive and innovative mindset, and seriously, you can get a discount via the Progressive Wage Incentive if you’re one of the first to do it. Apply now before it runs out!

NTUC Never U-Turns!

So there was an Op-Ed piece in yesterday’s ST by Han Fook Kwang, no less, which seems to say that the union movement made a u-turn in their policy on having a mandatory minimum wage. How many times must say liao, that it is not a minimum wage? NTUC never u-turns, understand? It might upturn once in a while, with a song, even, but never u-turn, can?

Besides, Lim Swee Say has been saying things in favour of the Progressive Wage Model since he was Environment Minister, and that was a long time ago.

But seriously though, even if I can’t prove conclusively that having a mandated minimum wage across sectors would sabotage the economy, I think that the progressive wage model is quite a good idea. Pegging wage increases (which already come with public assistance) with job and skill enhancements and pouring public funds into assisting training programs so that employers adopt them sounds good enough for me to support it.

I just hope the usual naysayers would take a closer look at what the Progressive Wage Model entails and how much public funding is going into supporting lower waged workers before they criticise every quarter for not helping. And then if they still must say nay, try to come up with a better alternative.

Fixing Low Wages: Buck Also Stops At Employers’

Out of curiosity, I attended the Ordinary Delegates’ Conference of the National Trades Union Congress at Far Far Away Country Club (Orchid Country Club) on Tuesday.

As with many things to do with Singapore, there’s little pomp and ceremony to do with these things if you were to compare with our neighbouring countries: it is said that the world stands still when a Malaysian minister attends the opening of an umbrella.

There was still some ritual involved – calling the conference to order and declaring quorum and all that. But I was a bit disappointed to discover that union leaders were now addressing each other as “brother” and “sister”, much like a mega-church congregation, rather than the historically more significant and gender-neutral “comrade”.

OK enough of my frivolity and nongsern. More serious reactions to what was said at the NTUC Ordinary Delegates’ Conference by Ministers and union leaders were predictably swift.

Most of the complaints come from people who are not convinced that the government is making efforts to improve the lot of lower wage workers primarily because they feel that low-wages were made endemic by policies of the same government which were intended to fix a critical labour shortage.

Tripartism – a term often bandied about by the labour movement – refers to the workings of the unions, the government and employers in concert.

I don’t think there’s any other jurisdiction in the world where it’s been so effective for so long. But tripartism is only as effective as the weakest link.

With unions pushing for better wages through Progressive Wage Model and the government handing out subsidies, the slack seems to be appearing in the third partner’s hands. Sadly it is the employers who are directly in control of workers’ wages.

Still, it is helpful to note that attempting to achieve equilibrium between the labour market and the economic and social health of the nation is always going to be a fluid task that never ends. That’s why I’m thankful for those among our leaders who are able to recognise bottlenecks as they appear, have the political will and ability to make running repairs while attempting to define and crystallise the will of the people.

Security Association Shooting Themselves In The Foot

T. Mogan and Friends: Do these guards know that they’re posing for a photo accompanying an interview which asks NOT to raise pay?
T. Mogan and Friends: Do these guards know that they’re posing for a photo accompanying an interview which asks NOT to raise pay?

I read with some dismay last month the Security Association of Singapore’s chief’s statement about proposed progressive wage model guides for security professionals.

It is positions like that which pose the biggest obstacles to better jobs and working conditions for lower income workers which NTUC has been calling for. Security guards remain one of the lowest paid workers in Singapore, and it is damn sian to hear people complaining that “gahmen don’t care about low wage workers” while at the same time railing against proposed improved wages.

Mr T. Mogan’s complaint in the ST interview, that “flexibility” is needed in place of Progressive Wage increases are a disservice to his industry.

The whole idea of progressive wages (as opposed to a wholesale minimum wage system) is flexibility. You don’t raise wages just ‘cos you think you need to – the work that is tied to the wage increase has to be improved.

Furthermore, security companies have also been complaining that since the rule was implemented several years ago to restrict security professionals to Singaporeans and PRs, “cannot find security officers – nobody want to work”.

As a friend in the HR business puts it – “then pay them more lah, wah lao.”

Before you get more shrill in your protests about higher overheads and needing to shut your businesses down, please, read on:

Your security business is in need of a serious revamp. The entire industry is. This dependence on low wage workers to service clients in a 24hr a day service is so very obviously not sustainable. I’m sorry, but you have to be the ones, together with your customers, to bite the bullet.

You may well protest against even that – saying you have done everything you can – improved the workers’ wages and trained them – but the fact remains that your customers still need to have 24hr a day security guarding, and that has become a lot more expensive with the wage increase, and therefore a wage increase does not and cannot create an increase in productivity.

But what if you exercised the other letter in the acronym PIC (Productivity and Innovation Credit – see also “free Gahmen money”): “Innovation”?

What if you took the shocking step of telling your customer, “eh boss, acherly hor, you no need 2 shifts x 12hr x day security guard – we can use centralized CCTV so you share one team of 2 roving security guards for this 16 square km area. Any sign of trouble – like somebody forget to close security door, the alarm will alert the guards to come and investigate. Around the same price. Can?”

Who will foot the bill, you say? That’s too radical, you say?

There’s a Swedish company in Singapore that’s already doing that – Securitas. Roving guard teams, state-of-art surveillance systems, centralized security details, highly trained and certified officers who are paid higher than industry standard. Smart, happy security guards backed by technology. Who dowan?

The more Singapore security companies start to innovate, the more customers will get round to understanding what they need. It’s the same like in 2007 – people didn’t know they needed a smart phone which could do everything else apart from making voice calls, and which in fact has reduced the number of voice calls.

For instance, most condos don’t actually need security guards if you think about it. You don’t even really need a doorman or a carpark attendant – which is what most condo guards double and triple up as. Replace this staffing with one daytime caretaker and a security surveillance system like the one described above. Double confirm can one.

As to who will foot the bill, sorry friend, you have to put some money down into the industry you’ve known and loved and want to see improved. But don’t worry, got free monies in the form of PIC, NTUC’s e2i Inclusive Growth Programme and more.

If you take a look here, you’ll see that in some instances, if you wanted to invest in $100,000 worth of equipment/software, you may only end up effectively paying $5,000 of the total cost, and think that Christmas has come early.

Meantime, tolong please, raise pay – gahmen will pay 40% of your wage increase.

Are We Outsourcing Our Social Responsibility?

A couple of weeks back I was invited to speak on a panel discussing a Clean & Green Singapore. I said agreed because I had always wanted to meet Sivasothi, one of Singapore’s leading environmentalists. We’ve known of each other since the term “blog” was invented, but for reasons uninvestigated, we had never actually met.

The discussion panel took its predicted path down governmental measures lane and civic mindedness alley and it was only when Siva spoke about what he did to the students he taught at NUS that I really began listening (sorry NEA, rest of panel – it was one of those days I was triple-booked).

Siva, who later shared my regret that we weren’t as entertaining and fiery as we should have been, has this fabulous requirement of his students. They are required to put their chairs back in place after a lecture has concluded. And – this will blow your socks off if you weren’t wearing slippers like the sloppy Singaporean you are – he makes his students find out the name of the cleaner who cleans the areas in and around the lecture theatres!

Then I started thinking about what had been spoken earlier in the discussion: that Singapore is not a clean city – it is a cleaned city. We don’t see, and neglect to care about the dusk to dawn army of cleaning workers who pick up our garbage in the streets and parks at night.

I’ve mentioned how we delegate our personal responsibilities to so many people that we’ve forgotten we have these responsibilities. Not only do we not know who takes away our trash, we don’t even take out our own trash.

Earlier in the week, I left for work at the same time the guy from the cleaning company was mopping the floor at our lift lobby. I said good morning and he jumped out of his skin. I decided not to startle him further, and will ask for his name next time we meet.

At a meeting a fortnight ago, a bunch of young entrepreneurs was telling us about the disparity between the cleaning company’s contract fee and the actual salary of the person actually doing the job. Yes, there are cleaners who are getting paid $800 a month or less.

It’s a lot more complicated than just saying ‘yes, we need to pay the cleaners more’,  and the tyranny of modern economic conveniences will mean that business owners will still want to engage a cleaning company than to employ a cleaner directly.

It follows that something needs to be done about the people who are directly employing the cleaners. And apparently, something that will pay them more than a mandatory minimum wage, like the progressive wage model I wrote about earlier will come into being next year. Here’s hoping it works out well.

But as I was saying on that panel that evening, if you want a more caring, compassionate society, you have to start thinking of the consequences of every action. There are things within your means you can do to help low wage workers like cleaners.

You want to care about the cleaners who are paid little? Make their job easier. Pick up after yourselves, return your tray, push your chair back after you get up.

I sit on the management council of the condo we live in, and I went on a little power trip at a meeting last week. The security guard company we hire had requested for a fee increase. I voted ok as long as we know that the two guards, who look after our premises and make sure no idiots anyhowly park in our car park, have a commensurate pay increase as well. We even voted on a little thing – making sure there’s enough mosquito repellent in the guard house so they don’t kenah dengue.

I’ve just found out that what we were doing was this thing called “best-sourcing”, which is gahmen-speak for outsourcing in a conscious, conscientious and socially responsible way. And like many things about this fine country, there’s even a monetary incentive to do so.

But as we become increasingly out-sourcery, we must not let ourselves or our corporations outsource our social responsibilities.

I think it’s time I called another council meeting.