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The fine print in Singapore’s new regulations for platform work: Explainer

The fine print in Singapore’s new regulations for platform work: Explainer

Source: Business Times
Article Date: 24 Nov 2022
Author: Sharanya Pillai

The Advisory Committee for Platform Workers took a nuanced, rather than broad-based approach.

Singapore will not call ride-hailing drivers and delivery riders “employees”, like they are overseas. But the country is set to implement changes that will provide employee-like protections for this group of vulnerable workers.

It isn’t quite as simple as making contributions to the Central Provident Fund (CPF) compulsory across the board. Rather, the Advisory Committee on Platform Workers – the body tasked with the policy review – recommends a more nuanced approach with exceptions for older workers of one specific cohort.

It gets even more complex on the matter of work injury insurance, given that platform workers often work with several apps – or “multi-home”. Coverage is based on a workers’ earnings across the sector, and not just with the liable platform.

The Business Times delves into the fine print.

1. Employee-like CPF, but voluntary for those 30 and above in the first year the change is implemented

What it’s like now: Platform workers must contribute between 8-10.5 per cent of their earnings to their MediSave accounts. Platform companies do not have to contribute anything.

  • Platform workers will pay CPF contributions at the same prevailing rate as employees. The current rate is 20 per cent of wages.
  • Likewise, the platforms will have to contribute at the same prevailing rate that all employers do. The current rate is 17 per cent of wages.
  • The CPF rates will be gradually increased over a period of five years.

But there is an exception:

  • CPF will be voluntary for platform workers who are aged 30 and above in the first year the change is implemented.
  • Example: If the change comes into effect in 2025, the full CPF regime is optional for those born in 1995 or earlier. But they are encouraged to opt in.
  • Platform companies will need to collect the CPF contributions on behalf of the workers. They are working with the government on a new mechanism for easy deductions.

2. Injury insurance at the same level as employees, adjusted for “multi-homing”

What it’s like now: Work injury insurance varies widely across the platforms and is generally lower than what the law mandates for employees, under the Work Injury Compensation Act (Wica). For instance, Wica stipulates a minimum S$76,000 payout for the death of an employee. But many platforms provide much less than that.

What will change:

  • Platforms will need to provide insurance with the same scope and levels of compensation as Wica.
  • The platform that the worker is serving at the point of injury is responsible. For example, Grab would have to compensate a rider injured while making a GrabFood delivery.
  • The timeframe in which a platform worker is said to be “at work” will also have to be defined. The government could factor in a waiting time of “x” minutes for food delivery and ride hailing.

But here’s where it gets complex:

  • Many platform workers earn from multiple apps. The GrabFood rider may also be reliant on foodpanda and Deliveroo for his monthly earnings.
  • To account for this, the committee recommends that the platform compensates the rider not just based on his earnings with that one app, but his earnings across the whole platform sector.
  • In the case of our hypothetical GrabFood rider, Grab would have to compensate him based on his earnings across Grab, foodpanda and Deliveroo.
  • This will require some guidelines for computation, which have yet to be announced.

3. Platform workers will get the right to represent themselves

What it’s like now: Platform workers are represented by three associations: the National Delivery Champions Association, National Taxi Association and National Private Hire Vehicles Association. But these do not have the same powers as unions.

What will change:

  • Platform workers will be given the right to seek formal representation, through a new framework designed for them.
  • The framework will cover how the representative body can seek its mandate from workers, issues it can negotiate with the platforms, and dispute resolution processes. 
  • The advisory committee had in August convened the Tripartite Workgroup on Representation for Platform Workers (TWG) to discuss the new framework. 

4. Exclusions for street-hail taxi and logistics:

  • Taxi drivers’ street-hail jobs will be excluded from the advisory committee’s recommendations, as they are considered “not subject to a significant level of control by taxi companies”.
  • Likewise, logistics companies that use self-employed delivery workers on an ad-hoc basis, without algorithmic matching of demand and supply, are also exempted.

Source: Business Times © SPH Media Limited. Permission required for reproduction.

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