Alternative Options to Retrenchment for Employers

In our last blog on 23 April, found here, we provided you with information about the various schemes and options available to employers, to help during these challenging economic times. In this blog we shall be writing from a slightly different perspective, looking at what the options are for you, the employer, to avoid having to lay off your employees.

When reading this blog to help inform decisions on possible actions to take for your employees, it is worth bearing the Job Support Scheme (JSS) in mind (covered in our previous blog). The JSS provides a wage subsidy of varying percentages, dependent on the sector in which you operate. This in turn helps to pay employees. The JSS will be revisited below under “Leave Options”.

Remote Working

SME Support

For many businesses based in an office environment, although working from home leads to some complications, these hurdles can often be overcome. This will in turn allow you to keep employees working from the safety of their homes.

In an effort to support Small Medium Enterprises (SMEs) who might not otherwise have the required infrastructure, the Government has enhanced its Go Digital Programme. 

Information on digital resources, grants and training courses can be found on the Infocomm Media Development Authority (IDMA) website. These are pitched at a range of levels, from plans to start using digital solutions, to Industry Digital plans aimed at helping boost growth and productivity. There is also cost free support provided by the SME Digital Tech hub, which more information can be found on the IDMA website.

More SME specific information can be found on the dedicated IDMA SMEs Go Digital page.

Productivity Solutions Grant

A further source of support for SMEs to keep on employees is the Productivity Solutions Grant (PSG), mentioned in the Resilience Budget. The PSG covers both sector-specific solutions in areas such as retail, food and construction, as well as solutions that are useful to all industries, such as customer management, data analytics and inventory tracking. These digital solutions could in turn further bridge the gap between working from home and in the office.

A grant of up to 80% will be available to businesses between April and December 2020.

The eligibility criteria are as follows:

  • Registered and operating in Singapore
  • Purchase/lease/subscription of the IT solutions or equipment must be used in Singapore
  • Have a minimum of 30% local shareholding (for selected solutions only)

More information on the PSG and solutions which are available can be found on the Enterprise Singapore website here.

General Business support

Enterprise Development Grant

The aim of the Enterprise Development Grant (EDG) is to help Singapore companies transform and grow. This grant supports projects falling under 3 key pillars, those being:

  • Core Capabilities
  • Innovation and Productivity
  • Market Access

The grant funds qualifying project costs, such as consultancy fees, software and equipment and internal manpower. It therefore can provide further relief on employee wages. The maximum support level for the grant is up to 80%, or 90% for the most severely impacted companies, which is to be reviewed on a case by case basis. The scheme will run between April and December 2020. 

The eligibility criteria are as follows:

  • Be registered and operating in Singapore
  • Have a minimum of 30% local shareholding
  • Be in a financially viable position to start and complete the project

You can find out more information on the EDG and how to apply here.

Leave Options

As mentioned in our previous blog, in some cases the options mentioned above are of little use for certain industries and vocations. This therefore means that for the period which the lockdown is in force, they will need to be put on leave or even laid off.

Where employees are able to work, but are prevented from doing so due to the lockdown, employers and employees can agree that annual leave be used to cover some or all of the lockdown period on full pay. You are also always able to extend extra paid leave days to all employees should you so wish.

With the help of the Job Support Scheme (JSS) mentioned in our previous blog, employers automatically receive contributions towards the employees which they keep on. Therefore even if employees are put on leave, employers will still be able to pay employees in some capacity. This hopefully provides a strong incentive to deter retrenchment.

If none of the above is feasible and it is decided that employees need to be laid off, it is advisable to point your employees towards the COVID19 Support Grant, if they are eligible. Applications are open from May 2020 and more information on eligibility can be found here. Alternatively, employees can enquire by calling 1800-222-0000 or emailing [email protected].

Employee Upskilling

Workfare Training Support Scheme

Under the Workfare Training Support (WTS) scheme, a number of higher course fee subsidies and Training grants covering 95% of Absentee payroll have been introduced. This provides an opportunity for the time spent away from the office, to be a great way to upskill your employees.

Training accommodated under the scheme includes Singapore Workforce Skills Qualifications (WSQs), Part-time ITE skills certificates offered by the Institute of Technical Education, SSG certifiable skills training courses, as well as standalone skills based modular training.

For an employee to be eligible, they must be:

  • a Singapore citizen;
  • aged 35 years and above on 31 December 2020 (aged 13 years and above for persons with disabilities);
  • earning an average gross monthly income of not more than $2,000 for the months worked; and
  • signed up for any WTS qualifying courses prior to making an application for funding.

For more information on the grants and courses available, as well as how to apply, please follow this link to the Singapore Workfare website.

We hope that this information proves useful to you. If you have any queries on how the above relates to payroll and the SimplePay system, please feel free to get in touch with our customer support team at [email protected].

Keep well. Stay home. Stay safe.

Team SimplePay

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