Employment Dispute Resolution in Singapore

1. Introduction a. Objectives The objective of the report is to provide a better understanding of the roles of the different courts in settling employment disputes. At the end of the report, reader would be able to find alternatives in settling employment disputes too. b. Methods of Research In this report, there will be real life case studies settled by different courts for settling disputes. These cases will help in illustrating the criteria for using the different courts. This report will also include internet research. 2. Causes of DisputesDisputes are caused when both parties, namely the employer and employee, cannot come into an agreement over monetary issues such as wages, benefits and overtime pay. Other circumstance will be a violation of health safety standards or law that can be common law or related to employment. Court cases will arise when these disputes are not resolved by conciliation or mediation. 3. Acts Relating to Employment There are two main acts that concern th e procedures of settling disputes. They are the Employment Act (EA) and Industrial Relations Act (IRA). c. Employment ActFor employees covered by the Employment Act, employment disputes will only be referred to the Labour Court for adjudication if they are unable to be resolved amicably through conciliation. Conciliation is a process which involves negotiations between the parties, then coming up with a mutually agreed decision that is fair to the parties involved. However, certain conditions must be satisfied, that the claim must be on matters arising not earlier than one year from the date of lodging the claim, and if the employee concerned had already left employment, the claim must be lodged within six months from the date of leaving employment.For managers and executives who are not covered by the Employment Act, the Ministry will consider providing mediation service to help resolve employment disputes on breach of contract or retrenchment. Mediation, a non-adversarial process, involves a mediator who will facilitate the entire process by helping the parties involved to first identify issues, negotiate, then find a practical solution and settlement that all parties involved are mutually agreeable to and able to accept. The mediation process is voluntary and considered on a case-by-case basis.There are certain requirements that will apply, which includes that the managers and executives are earning $4500 and below, the claim is in respect of a matter which occurred within the period of one year before the date that the issue is reported, if the claim is for items related to their termination (e. g. notice, the issue must be lodged within six months from the date on which the employee has left employment), and when viable alternatives such as private amicable settlement with employer had been exhausted.However, if either party fails to respond to mediation or if no amicable settlement could be reached after mediation, the matter will then be pursued in the civil court. d. Industrial Relations Act The Industrial Relations Act is passed in 1960 to provide a mean to settle employment disputes through collective bargaining which involves the union, conciliation and if unresolved, through arbitration held by the Industrial Arbitration court. This act aims to protect employees who are members of the union, allowing them to enjoy benefits covered under.Examples of union include the Food, Drinks and Allied Workers Union and Singapore Airlines Staff Union. This act limits the representation of employees who are in managerial and executive positions in certain areas. As defined in Section 30(1) of Industrial Relations Act, an executive employee is an employee who is employed in a managerial or executive position. They are not allowed to have representatives from the union to negotiate for retrenchment benefits upon retrenchment or resolving any dispute in the contract of employment.As this act is a bridge to the tripartite relationship in Singa pore, namely the government, employer and employee, there are certain procedures to follow in accordance to filing a case against the employer in a unionized organization. Preceding the filing, the employee would have to try to resolve the dispute with his immediate supervisor. Failing that, he or she can choose to bring the matter up to a member of the branch committee of the Union who would make a representation of the employee in resolving the dispute.In more serious cases, it can be brought up to the Human Resource Department by the General Secretary of Union and may even request a union management meeting with the management of the company. After all means, both parties will then refer the case to Ministry of Manpower for conciliation which is an invitation to negotiate under the Act. If an agreement is not reached by both parties, they can seek mediation by the Industrial Arbitration Court. 4. Different Courts The employees covered under the different acts will bring up their unresolved disputes to different courts. . Labour Court The Labour Court, deals with issues between employers and employees when they cannot be resolved through mediation or reconciliation at the MOM level. It is empowered by law to inquire into and arbitrate disputes between employees and employers. If mediation between the parties does not yield any agreement, for example, company not paying their employee salary or wrongful dismissal. The decisions or orders by the Labour Court are enforceable. It is also more viable for the employee to go through the Labour Court to settle employment disputes.However, the employees must not be earning more than S$2500 per month and are covered under the Employment Act. In the case of Vertex Global Holdings Pte Ltd, they owed an employee in arrears for about 2. 5 months. They gave the reason of having financial difficulties and were not able to pay the employee. The case was brought up to the Labour Court but they did not accept this explanation and the company was ordered to pay the employee amounting to $2820. In another case whereby a cook employed by VP Food Pte Ltd, he was terminated after 3 days.However, the employer was to pay him a sum of $235. 38 for work done but was underpaid. The reason that the employer gave was the distress caused by the cook’s harassment and there was no notice period specified. The explanation was rejected. The court held that Employment Act prevails and notice pay was payable In such cases, Labour Court comes into good use when dealing with unfair treatment from the company. But in recent years, the number of cases being brought up to Labour Court has decreased from 2009 to 2010.This shows that mediation or reconciliation has contributed to a huge part of the decrease in number of cases and they would be a better solution to problems than going to court. f. Industrial Arbitration Court Employment disputes, concerning union members, are not resolve under the conciliation of MOM are re ferred to the Singapore Industrial Arbitration Court (IAC) for further remediation. The IAC resolve disputes between employers and employees by offering the best possible solutions that are not only fair and beneficial to both parties but also in the interest of the community and country’s economic situation.The decision made by the Justice of IAC is concluding hence it cannot be disputed or appealed against. Voluntary and compulsory arbitration are the two ways that employers, unions or the government can refer an employment disputes to the IAC. Through the voluntary arbitration, employers and unions can refer their cases to the IAC through a joint or ex-parte application however this is only applicable when mediation at the MOM level is deem inconclusive. Under compulsory arbitration, a dispute is referred to the IAC when it is directed by the MOM or the President of Singapore.With increasing efforts from tripartite co-operation, Singapore has seen a great decrease in the n umber of cases being handled at IAC. The number of employment dispute cases averaged 10 per year and this indicate that that majority of the cases are being resolved at MOM and union level. This is essential as it helps to reduce unnecessary loss of work man hours and provide foreign investor’s confidence to invest in Singapore which in turn boosts the Singapore economy. Over the years, IAC has proven to be an effective way in solving disputes between employees and employers however there are cases when one party might feel otherwise.In the case of the dispute between Singapore Refinery Company and the representing union, the general secretary of SRCEU mentioned that â€Å"the union is disappointed with the ruling as a whole. † The case was brought up to the IAC for settlement as the union demanded salary and service increment for SRC employees. The president of IAC concluded that SRC will increase the service increment to 5 per cent plus $15 and 3 per cent salary incr ement. The union felt that the increment was too low and there was no effective communication between them and the company.This case show that whiles the IAC may provide the best feasible solution however it does not mean that it is the best fit for all the parties involved in the dispute. g. Civil Court The role of civil courts in resolving employment disputes is at minimal. Disputes raised by Professionals, Manager and Executives, also known as the PMEs, earning up to S$4,500, are solved in civil court. However, the Ministry of Manpower in Singapore is looking into resolving their salary disputes in Labour Court in the near future, limiting it to S$20,000.This allows PMEs to seek a lower cost alternative in resolving their disputes. For breaches in employment contract, it will still be handled by civil courts under law of contract. 5. Comparison h. Differences Between The 3 Courts | Civil Court| Labour Court| Industrial Arbitration Court| What they settle? | Employment disputes on breach of contract or retrenchment that cannot be resolved through mediation| Employment disputes that cannot be settled through conciliation| Trade disputes that cannot resolve through conciliation| How they settle? The role of Civil Court in resolving disputes is at minimal. Civil Court handles breaches in employment contract under law of contract. | The court has the authority to analyse and settle disputes(for example, unfair treatment from the company)| Resolve employment dispute through arbitration. The decision made by the Justice of IAC cannot be disputed or appealed against. | Criteria| PMEs(Professionals, Manager and Executives) earning up to $4,500| No legal representation is allowed in Labour Court.Employees not earning more than $2,500 per month and are covered under Employment Act| An executive employee who are employed in a managerial or executive position are not allowed to have representatives from the union to negotiate for them(retrenchment or disputes in the con tract of employment)| Who can go? | Managers and executives that are not covered under Employment Act| Employers and Employees under Employment Act| Employers and trade unions| In the past, Singapore employment law has been favorable to employers.However, the trend in recent years shows that enhancement of employee welfare and safety became more important. i. Singapore versus United States of America Both countries show various similarities of the roles of court in settling employment disputes. In United States of America (USA), employees are allowed to sue for dismissal due to discrimination of gender, religion, origin and many more. Employees are generally protected against discrimination under U. S Equal Opportunity Commission (EEOC).In Singapore, employers are encouraged to practice fair employment promoted by Tripartite Alliance for Fair Employment Practices (TAFEP). In both countries, employees are allowed to bring their employers to court in any event that there are employmen t disputes and unresolved by conciliation and arbitration. However, there are differences too. In United States of America, the government is more in favor of the employees whereas in Singapore, the government is more in favor of the employers.Also, in any disputes, the United States of America allows employees to hire a lawyer or an attorney to represent them in court. In Singapore, employees covered under different acts are represented by different people such as the union leader or even unrepresented in front of the labour court. The different courts are designed to different cases involving money or other disputes while all disputes in United States are brought to only one court. 6. Conclusion Through intensive research and findings, this report covers the key points on how the different courts resolve employment disputes.Although MOM have proven to be an effective medium in mediating disputes between employers and employees, there is still a need for the presence of court to re solve cases that are more complex. Case studies are being brought up in the report to further illustrate how disputes are being resolved at different levels. In referring to the SRC case, it clearly highlight that although the IAC has provided the best possible remedy however it does not satisfy all parties who are involved in the case.This means that better procedures can be considered to better understand the problems underlying between employees and employers. Through our recommendations, it will provide possible solution to further enhance the system that is already in place. The recommendation will not only look at the current problems but it will also propose how corporations can create a harmonious working relationship among employers and employees. 7. Recommendations