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Transforming Lives with the Progressive Wage Model (PWM)

Samantha

Transforming Lives with the Progressive Wage Model (PWM)

In a rapidly evolving economy, ensuring fair wages for all workers is more important than ever. The Progressive Wage Model (PWM) is a groundbreaking initiative in Singapore designed to uplift lower-wage workers by tying wage increases to skills and productivity enhancements. This blog delves into the PWM, exploring its benefits, implementation, and the transformative impact it has on workers and businesses alike.

What is the Progressive Wage Model (PWM)?

What is the Progressive Wage Model (PWM)?

The Progressive Wage Model (PWM) is a structured wage ladder aimed at increasing the wages of lower-wage workers through skills upgrading and productivity improvements. This initiative was developed through a collaborative effort by unions, employers, and the government. The PWM’s primary objective is to get higher wages and ensure that workers are fairly compensated while simultaneously encouraging continuous skill development and higher productivity.

Benefits of PWM

For Workers:


Wage Increases: Workers see a steady increase in their wages as they upgrade their skills.


Career Pathways: It offers clear career progression pathways, motivating workers to pursue higher roles and responsibilities.


Skill Development: Workers receive opportunities for training and skills development, enhancing their employability and job satisfaction. 

Improved Service Quality: Businesses benefit from a more competent and motivated workforce, leading to improved customer satisfaction.

For Employers:


Higher Productivity: Skilled workers contribute to higher productivity and better service standards.


Improved Service Quality: Businesses benefit from a more competent and motivated workforce, leading to improved customer satisfaction.


Reduce Turnover and Recruitment Costs: Reduces turnover by offering competitive and fair wages, leading to lower recruitment costs.


Greater Social Cohesion: Promotes a fair and inclusive workplace by ensuring equitable wage distribution and career advancement opportunities.

For Service Buyers:

Service buyers experience enhanced service quality, as the workers involved are better trained and more skilled, leading to higher standards of service delivery.

Who Does PWM Cover?

The PWM primarily covers Singapore citizens and Permanent Residents (PRs) in specific sectors. Employers hiring foreign workers must comply with PWM requirements to ensure fair treatment and wages for local and to hire foreign workers.


The PWM has been progressively implemented across government contracts in various sectors

PWM Implementation Timeline

The PWM has been progressively implemented across government contracts in various sectors:


Cleaning Sector: In 2012 the PWM was first introduced in the cleaning sector, setting a precedent for other industries.


Security Sector: In 2016 the security sector adopted the PWM, aiming to improve wages and skills for security personnel.


Landscape Sector: In 2016 implementation began in the landscape sector to ensure fair wages and career progression for landscape workers.


Lift and Escalator Sector: In 2019 the PWM was extended to workers in the lift and escalator maintenance sector, focusing on enhancing their skills and productivity.


Retail Sector: In 2022 the PWM was introduced in the retail sector, benefiting sales and service workers.


In 2023 workers in the food services sector began to see the benefits of PWM with structured wage increases and skill development.

Food Services Sector: In 2023 workers in the food services sector began to see the benefits of PWM with structured wage increases and skill development.


Occupational PWs for Administrators and Drivers: In 2023 PWM was expanded to cover administrative workers and drivers, ensuring fair wages and career progression.


Waste Management Sector: In 2024 the latest sector to implement PWM, waste management workers are now benefiting from structured wage progression and skill development.

How PWM is Implemented?

PWM implementation varies by sector, each regulated by relevant authorities to ensure compliance and effectiveness:


PWM implementation varies by sector, each regulated by relevant authorities to ensure compliance and effectiveness

Cleaning and Waste Management: Regulated by the National Environment Agency (NEA).


Security: Managed by the Police Licensing and Regulatory Department (PLRD) of the Singapore Police Force (SPF).


Landscape: Overseen by the National Parks Board (NParks).


Lift and Escalator: Regulated by the Building and Construction Authority (BCA).

Introducing the Progressive Wage Mark (PW Mark)

The Progressive Wage Mark (PW Mark) is a certification scheme introduced by the Singaporean government to acknowledge and reward firms that adopt progressive wage practices. The primary purpose of the PW Mark is to recognize companies that pay fair and sustainable wages, thereby improving the livelihoods of their workers and promoting inclusive growth in the economy.

Purpose of the PW Mark

The PW Mark aims to:


Ensure Fair Compensation: Guarantee that workers are paid wages that reflect their skills, productivity, and contributions.


Encourage Career Progression: Provide clear pathways for career advancement and skill development.


Boost Productivity: Motivate companies to invest in their workforce, leading to higher productivity and better service quality.


Promote Inclusive Growth: Elevate the wages and working conditions of low-wage workers, contributing to more equitable economic development.

Progressive wage mark

Benefits of Obtaining the PW Mark


Greater Visibility: Certified firms gain recognition as fair employers, enhancing their reputation among customers, partners, and the public.


Consumer Support: Consumers are more likely to support businesses that treat their employees fairly, leading to increased customer loyalty and business growth.


Government Procurement: Companies with the PW Mark may receive preferential treatment in government procurement processes, opening up new business opportunities.

Eligibility for PW Mark

To be eligible for the PW Mark, firms must meet specific criteria related to hiring practices and wage compliance for local workers. The key eligibility requirements include:


Hiring Requirements: Firms must demonstrate fair and equitable hiring practices that promote diversity and inclusion.


Wage Compliance: Companies must comply with sectoral or occupational progressive wage requirements for their workers.


Progressive Wage Mark banner - The mark of a progressive employer

PW Mark Plus

If your firm meets the eligibility requirements of the PW Mark and also adopt the Tripartite Standard on Advancing Well-being of Lower-Wage Workers (TS-LWW), your firm will be conferred the PW Mark Plus.

The TS-LWW outlines a set of progressive workplace practices to provide better workplace support for our lower-wage workers in the areas of training and career development, workplace safety and health, and rest area provision.

Local Qualifying Salary (LQS)

The Local Qualifying Salary (LQS) is a key component of the PWM, determining the minimum wage required for local employees to be counted towards a firm’s foreign worker quota. The current LQS is $1,400, which will increase to $1,600 from 1 July 2024. This ensures that local workers receive meaningful employment and fair wages.


Part-Time Local Workers: Must earn at least $9/hour gross for those working less than 35 hours per week.


Full-Time Local Workers: Must earn at least $1,400 gross for those working 35-44 hours per week.


Full-Time Local Workers with Overtime: LQS requirement increases with each hour of overtime.

Practical Example

Consider a part-time local worker earning $10.30/hour working 10 hours per week. Although they meet the hourly LQS requirement, their monthly earnings would be below $700, meaning they do not contribute towards the employer’s foreign worker quota.

Support for Employers

Employers implementing PWM can access various support schemes:


Training Costs: The Workfare Skills Support scheme helps cover training costs.


Business Grants: The Business Grants Portal offers assistance for job redesign, productivity enhancement, and capability building.


Government Co-Funding: The Progressive Wage Credit Scheme provides co-funding for wage increases.

Support for Employees

Employees unsure about their PWM compliance can seek clarification and assistance through the Progressive Wage Portal, which allows workers to check wage compliance and other relevant details.

The Progressive Wage Model (PWM) is a transformative initiative that benefits workers, employers, and service buyers alike. By tying wage increases to skills and productivity, it ensures fair compensation and continuous development for lower-wage workers. Employers and employees are encouraged to embrace PWM for mutual benefits and access the resources available for further information.

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Additional Resources

For more information, visit the following resources:




By understanding and implementing the PWM, we can work towards a fairer and more productive workforce, transforming lives and businesses in Singapore.

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