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Singapore's Job Support in the Time of COVID-19

May 04 2020 | by OrionW

As the coronavirus (COVID-19) outbreak has worsened to become a pandemic, the Singapore government has introduced and improved two programmes designed to encourage employers to retain and raise the wages of their employees.  The Jobs Support Scheme (JSS) is a new temporary programme under which the government provides cash grants equal to a significant portion of a company’s wage cost for Singapore citizens and permanent residents (Local Employees).  The Wage Credit Scheme (WCS) is an enhanced version of an existing scheme that co-funds wage increases for Singapore citizens.

Jobs Support Scheme

JSS is designed to help companies retain their Local Employees.  JSS provides a base level cash grant equal to 25% of the first S$4,600 of gross monthly wages of Local Employees, with higher percentages paid in the cases described below.  The programme covers wages paid for October – December 2019 and February – July 2020.

JSS offers additional tiers of support for the aviation, tourism (including certain arts, culture and recreation establishments) and food services sectors.  In addition, the payout for all sectors in April 2020 will be at a 75% level in recognition of the business closures mandated for that month.

JSS has been improved twice since it was first introduced in the 2020 Budget in February 2020.  This table summarises the current version of JSS:

Payout

Payout Date

Payout Amount

Capped at the First S$4,600 of Gross Monthly Wages

Base

Food Services

Aviation & Tourism

Payout 1

Apr 2020

75% of Oct 2019 wages

75% of Oct 2019 wages

75% of Oct 2019 wages

25% of Nov 2019 wages

50% of Nov 2019 wages

75% of Nov 2019 wages

25% of Dec 2019 wages

50% of Dec 2019 wages

75% of Dec 2019 wages

Payout 2

Jul 2020

25% of Feb 2020 wages

50% of Feb 2020 wages

75% of Feb 2020 wages

25% of Mar 2020 wages

50% of Mar 2020 wages

75% of Mar 2020 wages

75% of Apr 2020 wages – 50% of Oct 2019 wages

75% of Apr 2020 wages – 25% of Oct 2019 wages

75% of Apr 2020 wages

Payout 3

Oct 2020

25% of May 2020 wages

50% of May 2020 wages

75% of May 2020 wages

25% of Jun 2020 wages

50% of Jun 2020 wages

75% of Jun 2020 wages

25% of Jul 2020 wages

50% of Jul 2020 wages

75% of Jul 2020 wages

The payouts are structured so that employers must pay wages in April 2020 to benefit from the special April enhancement.  Employers do not need to apply for JSS; benefits will be provided automatically based on their Central Provident Fund (CPF) payroll.

On 21 April 2020, the Singapore Government announced that the circuit breaker will be extended to 1 June 2020.  As a result, the wage support provided by the JSS will also be extended through the month of May.  In addition, the JSS has been enhanced to cover wages of employees who are also shareholders and directors of the company, provided that the shareholder-directors with Assessable Income have wages of S$100,000 or less for Year of Assessment 2019, and that the companies must be registered on or before 20 April 2020.

Wage Credit Scheme

WCS is a pre-existing scheme under which the government encourages employers to share productivity gains with Singapore citizen workers by co-funding wage increases (note, business owners and permanent residents are not covered).

This table summarises the enhancements to WCS:

Scheme Attribute

WCS Under Budget 2018

Enhanced WCS

Co-funding for 2019

15% of qualifying wage increases

20% of qualifying wage increases

Co-funding for 2020

10% of qualifying wage increases

15% of qualifying wage increases

Gross monthly wage ceiling

S$4,000

S$5,000

Qualifying wage increases

  • Increases in gross monthly wage of at least S$50 given to Singaporean employees in the qualifying year, up to a gross monthly wage level of S$4,000, will be co-funded.
  • In addition, increases in gross monthly wage of at least S$50 given in 2017, 2018 and 2019 up to a gross monthly wage level of S$4,000, and sustained in subsequent years of the scheme, will be co-funded.
  • Increases in gross monthly wage of at least S$50 given to Singaporean employees in the qualifying year, up to a gross monthly wage level of S$5,000, will be co-funded.
  • In addition, increases in gross monthly wage of at least S$50 given in 2017, 2018 and 2019 up to a gross monthly wage level of S$5,000, and sustained in subsequent years of the scheme, will be co-funded.

An employer qualifies for WCS in 2019 (i.e. 2019 is considered a qualifying year) if (i) the employer paid the employee’s CPF contributions for at least 3 months in 2019 and for at least 3 months in 2018 and (ii) the employee had a qualifying wage increase in 2019.

For More Information

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Disclaimer: This article is for general information only and does not constitute legal advice.