Better education on job contracts, watchlist for companies with unfair contract clauses needed—Zainal Sapari

Singapore—In his latest blog post entitled “Sign Die, Don’t Sign Also Die!,” Labour MP Zainal Sapari highlights the incidence of employers who put unfair clauses in their employment contracts, which leads to the abuse of the vulnerable position workers find themselves in.

In the blog post dated October 30, Mr Zainal, who is also the Assistant Secretary-General of the NTUC (National Trades Union Congress), wrote about how employers may sometimes resort to unfair practices “due to the challenging business environment” that could be detrimental to employees.

In particular, the Labour MP highlighted the inclusion of unfair clauses in employment contracts, noting how unethical this is,  “as they abuse the vulnerable position the workers might be in.”

Mr Zainal listed those unfair clauses, as well as gave examples of how they occurred in real-life cases.

1. Liquidated Damages Borne by Workers in such service industries that outsources its workers, like cleaning and security agencies.

He pointed out that “according to MOM’s website, salary deductions for liquidated damages should not be made even if consent has been obtained from the employees, as it is not to the benefit of the employee. If reported to TADM, employers must reimburse deductions arising from the list of liquidated damages to the employees.”

2. Penalties and Conditions for Termination of Contract. In the cat that Mr Zainal gives as an example, the employer added a clause that caused an employee to pay a penalty of “$50 per calendar day from the date of the termination notice till the one-year term.”

He added, What is even more incredulous is the penalty is payable even if the termination was initiated by the employer!”

3. Non-compete / Restraint of Trade Clauses

Even PMETs (professionals, managers, executives and technicians) have not been spared in cases of unfair clauses. One new graduate signed a contract wherein she was obligated “to pay a liquidated damage of S$100,000 to the company, should she resign and work for another company in the same industry.”

She was told this was a “standard” clause in employment contracts.

To address these kinds of situations that leave employees vulnerable, Mr Zainal pressed for better education for employees as well as employers.

At present, there are guidelines that people can consult as well as advisories on the website of the Tripartite Alliance for Fair and Progressive Employment Practices (TAFEP) to ensure a fair job contract. NTUC Union Members also have resources where they can get help.

Mr Zainal also suggested that reaching out to people to help them understand employment contracts can begin even while they are still studying at the post-secondary level.

He added a suggestion for the Ministry of Manpower (MOM). “Perhaps, MOM may also want to consider a “cooling off period’ (perhaps up to five working days) that will allow workers to rescind the employment contract they have signed, without penalty.”

Furthermore, he said that a watchlist could be started for companies that use such unfair clauses in their contracts, with corresponding penalties.

“To discourage such underhand tactics, MOM or TADM may also want to consider starting a watch list if companies are found or reported to have unfair clauses in their employment contracts. Administrative penalties should be imposed on companies on this watch list.”

Mr Zainal ended with a word of caution for both employees and employers.

“Regardless of how excited you are in securing that much-needed job, you should always read your employment contracts and keep a lookout for key employment terms before signing anything.

Employers can also do your part by ensuring your employment contracts take reference from industry norms or best practices.” -/TISG

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