Severe sanctions imposed for discriminatory employment practices

Non-discriminatory practices: the Fair Consideration Framework

In the short period of time since the implementation of the Fair Consideration Framework (“FCF”), the Ministry of Manpower of Singapore (“MOM”) has taken action against approximately 100 companies in Singapore for posting discriminatory job advertisements.

The FCF is a set of guidelines published by the MOM in August 2014, which essentially aims to ensure that all Singapore companies have in place recruitment models that are fair, transparent, merit-based and non-discriminatory. Another feature of the FCF is the requirement that all companies must consider Singapore citizens fairly for job vacancies.

Severe sanctions imposed by MOM – a drastic approach?

In a MOM press release of 29 December 2014, the MOM announced that severe sanctions have been imposed on a marine company in Singapore, Prime Gold International Pte. Ltd. (“Prime Gold”), for engaging in discriminatory employment practices against its Singaporean employees.

It was alleged that Prime Gold had retrenched 13 of its Singaporean employees unfairly in phases, only to have their vacancies made available to foreigners. In its defence, Prime Gold argued that the company was facing financial difficulties and the 13 employees were retrenched due to redundancy. Further, Prime Gold cited other reasons for retrenching these employees, such as the employees’ unsatisfactory work performance and lack of relevant qualifications. Despite this, the MOM determined that Prime Gold had denied its Singaporean employees of fair opportunities for employment. The MOM has taken a serious view of Prime Gold’s infringement of the FCF, and as a result, it restrained the work pass privileges of Prime Gold for a substantial period of 2 years.

Employee-orientated rules

This is the first time MOM has imposed such a heavy penalty against a Singapore company for breaching the FCF.

As stated above, the FCF not only requires all employers doing business in Singapore to consider Singaporeans fairly for job vacancies, but also to put in place fair employment, hiring and staff development practices that are transparent and non-discriminatory.

In view of the stringent approach taken by the MOM in recent times, it is advisable for employers to act cautiously, be it in the context of employment or termination. As a starting point, employers are encouraged to have in place a set of employment procedures and practices, and recruitment models, that are fair, transparent and non-discriminatory.

It is also advisable for employers to ensure compliance not only with the relevant law and regulations of the country, but also all guidelines, rules and employment practices published by the MOM from time to time. In the context of termination, it is always good practice to keep written records of all discussions relating to poor performance, any warning letters given (including emails), or any other evidence of unsatisfactory performance of the employee. These written records may serve well as supporting evidence in upholding the employer’s decision of terminating an employee.