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Ministry of Manpower
Consultation Period:
15 Nov 2021 - 15 Dec 2021
Status:
Open

Public Consultation on Strengthening Protections for Platform Workers

Detailed Description

1 Preface

1.1 Self-Employed Persons (“SEPs”) refer to individuals who operate their own trade or business. Unlike employees, SEPs generally have greater autonomy over what assignments to accept as well as when, where, and how they work. Many SEPs are not seeking to be employees. Recognising this, even as institutional support has been strengthened in recent years, personal responsibility remains the core principle for SEPs who prefer to be their own boss. 

1.2 Many SEPs are able to and have taken responsibility for their own well-being through making informed choices about contracting practices, protecting themselves against contingencies, and planning for their future needs. This is understandably easier to achieve for SEPs who are earning a high income. The need to further strengthen employment protections like work injury compensation, union representation, and employer Central Provident Fund (CPF) contributions is less relevant for this group.1

1.3 However, SEPs are not a homogeneous group, and can be found in over 200 occupations including taxi and private hire car drivers, insurance agents, business consultants and creative professionals. Given their diversity, we should avoid a one-size-fits-all approach to supporting SEPs.
  
1.4 Singapore, like many other countries, has seen a rise in recent years of the number of SEPs who work with platform companies to provide transport and delivery services (“platform workers”)2. Platform companies and workers have a symbiotic relationship, and provide a valuable service for users. The continued viability of the platform ecosystem is important. 

1.5 Many platform workers resemble employees in that they are subject to significant control by platform companies over the jobs they receive and accept, as well as the fee for their services. Yet, they do not have basic employment protections accorded to employees, such as work injury compensation, union representation, and employer CPF contributions. 

1.6 At the same time, these platform workers generally have modest incomes with limited prospect of wage progression. While we hear anecdotes of platform workers being able to earn high amounts especially during peak demand periods, our statistics show that the median take-home earning of people whose main source of income is platform work was comparable to that of the 20th percentile full-time resident employee in 2019.3 Platform workers also face uncertainty over their income per hour worked and bear their own costs of operations. Thus, there is a strong case to examine how we can do more for this specific group of SEPs. This situation is not unique to Singapore, and other countries have made moves or are similarly studying moves, including to strengthen protections for platform workers.

1.7 It is with this in mind that the Ministry of Manpower (“MOM”) convened an Advisory Committee on Platform Workers (“the Committee”) to look into strengthening protections for platform workers, specifically delivery persons, private-hire car drivers and taxi drivers.

1.8 The Committee will focus on the most critical protections pertaining to the long-term livelihood and resilience of platform workers:

(a) Improving retirement and housing adequacy: Platform workers, like other SEPs, are required to contribute up to 10.5% of their income to their CPF MediSave Account. This corresponds to the Medisave contribution rates made by employees. However, in the case of employees, the Medisave contribution is made by both the employee and the employer. Platforms, on the other hand, are not required to make contributions for platform workers. As platform workers generally have modest incomes, they are also more likely to need additional support to save for their retirement and housing needs.

(b) Strengthening financial protection in case of work injury: Platform workers, like other SEPs, are not covered under the Work Injury Compensation Act as they do not have an employment contract. However, they spend a disproportionate amount of time on the roads, putting them at higher risk of accidents and injury. 

(c) Enhancing representation: Platform workers, like other SEPs, are not able to unionise like employees can. They may thus face difficulties in seeking redress for work and pay-related grievances and better working conditions. This is despite the higher degree of control platforms have over their work arrangements.

1.9 The Committee will study different options carefully. It will consider the unique characteristics of the platform ecosystem and the interests of platform companies, platform workers as well as platform users (both businesses and consumers). The Committee recognises that these are complex issues with multiple trade-offs. All stakeholders are encouraged to actively provide their feedback. 

1.10 Please provide your feedback at go.gov.sg/feedback-ac by 15 December 2021. The Committee will factor in the feedback in its report, which is expected to be completed by the second half of 2022.




2 Accounting for Differences across Sectors, Companies and Workers

2.1 The platform landscape is diverse and includes point-to-point transport companies (such as taxi operators and ride-hailing platforms), food delivery platforms, as well as goods delivery platforms. Even within the same sectors, platform companies may have different practices. The level of control exercised by platform companies and the protection offered to platform workers may differ across platform companies. For example, some companies voluntarily match CPF contributions made by drivers, or extend personal accident insurance coverage to platform workers. 

2.2 Platform workers are a diverse group. For example, the level of reliance on income from platform work can vary significantly across platform workers. Some may engage in platform work full-time, while others do so on a part-time basis. Some may work with just one platform company, while others multi-home (i.e., work with more than one platform). Not all protections are equally important to all platform workers. For example, CPF contributions may be more important for workers who depend on platform work for their livelihood and retirement, as compared to students working to earn allowances.

2.3 While platform companies and workers may want interventions customised to their unique circumstances, higher levels of differentiation could make it difficult for workers to understand what protections are available to them, and increase the costs of implementation and enforcement. An understanding of the rationale for the differences is needed to determine the extent to which a differentiated set of interventions may be required.

The Committee seeks comments on how we should prioritise between: 

a. Having differentiated treatment to account for varied circumstances among sectors, companies, or workers; and 

b. Having consistent treatment across platform companies and workers for fairness and simplicity.


To help us better understand your comments, please also share:

(i) Relevant differences in circumstances at the sector, company and/or worker levels and why you feel these should be taken into consideration; and

(ii) Emerging trends that may impact the platform ecosystem over the next 5 years.


3 Improving Retirement and Housing Adequacy

3.1 Today, platform workers, like other SEPs, are required to contribute up to 10.5% of their income into their MediSave Account to support their healthcare needs. The government provides additional support for lower-income platform workers through top-ups to their incomes via the Workfare Income Supplement Scheme. Ideally, platform workers should build on this and set aside a separate sum for housing and retirement. In practice, they will likely find it challenging to do so on their own, as they generally have modest incomes.

3.2 For employees, their employers play a critical role in helping them save for the long-term by providing significant contributions (up to 17% of their income) to their CPF. However, while many platform companies have an employer-like relationship with platform workers, they are not required to make CPF contributions to platform workers.

3.3 Hence, platform workers tend to have limited resources in their CPF. If left unaddressed, many platform workers may struggle to meet their housing and retirement needs. For example, among taxi drivers who turned 55 in 2020, only 29% met their Basic Retirement Sum. 

3.4 We recognise that any broad-based moves to boost housing and retirement savings of platform workers may result in higher costs for platform companies, workers and/or users (both businesses and consumers). We will also be mindful of any unintended impact on the relative attractiveness of platform work compared to being an employee or engaging in other self-employed work.

The Committee seeks comments on:

(i) The extent to which retirement and housing adequacy measures should be aligned between platform workers and employees;

(ii) Possible ways to improve retirement and housing adequacy of platform workers; and

(iii) What would be a fair distribution of any additional costs arising from such moves among platform companies, platform workers, and platform users, and why.


4 Financial Protection in case of Work Injury

4.1 Platform workers spend a disproportionate amount of time on the roads compared to many other professions, putting them at higher risk of accidents and injury. Some platform companies have taken steps to extend personal accident insurance to platform workers, but the terms and coverage may be uneven across platforms. Work injuries may leave platform workers in a precarious financial position if they are unable to work as a result of the injury. This loss of income during the duration of recovery makes covering medical bills extremely difficult. Serious injuries resulting in permanent disability could lead to a loss of future earning power, for which platform workers may not be compensated.

4.2 In comparison, coverage under the Work Injury Compensation Act (WICA) is a basic right for employees. WICA provides employees with a low-cost and quicker pathway to claiming compensation for work injuries, without having to file a civil suit under common law. Compensation under WICA includes medical leave wages, medical expenses and lump-sum compensation for permanent incapacity or death. Currently, platform workers are not covered under WICA as they do not have a contract of service with platform companies.

4.3 Nonetheless, there are unique characteristics of platform workers that distinguish them from employees. Unlike employees, many platform workers multi-home (i.e., work with more than one platform). In the event of an injury, it is not immediately clear which platform is responsible to compensate, and how compensation should be determined. In addition, as the nature of platform work is interspersed with breaks, it may not be clear whether an injury is related to work.

4.4 We recognise that strengthening platform workers’ financial protection against work injury may lead to increased operating costs. This could in turn translate to lower take-home earnings for platform workers and higher prices for platform users. Platform workers’ work flexibility could also be impacted if platform companies seek to exert tighter controls to reduce their work injury liabilities. 

The Committee seeks comments on:

(i) The extent of compensation to platform workers for their work injuries. To what degree should their compensation be similar to or equal that for employees under WICA; and

(ii) The extent to which platforms should be responsible for providing financial protection for work injuries, vis-a-vis platform workers themselves. 


5 Enhancing Representation of Platform Workers

5.1 As platform workers are considered self-employed, they do not enjoy statutory employment protections and may face difficulties in seeking redress for work and pay related grievances. They are also not allowed to unionise, like other self-employed persons.

5.2 Today, the National Taxi Association (NTA), National Private Hire Vehicles Association (NPHVA) and National Delivery Champions Association (NDCA) serve as a collective voice for their respective groups of platform workers. They also promote the interest and well-being of platform workers. For example, they provide support and services such as training resources and guidance on workplace issues.

5.3 However, unlike unions, the associations do not have the legal right to negotiate contractual terms for their members. This may limit the extent to which the associations can effectively protect the interests of platform workers. 

5.4 Based on engagements with platform workers, some areas which could benefit from stronger representation are:

a. resolution of disputes between platform workers and platforms (e.g., cases where the platform worker is logged out of the platform, disputes over payment of earnings),
b. Adequacy of commissions/fares for each trip/delivery,
c. how responsibility for fulfilling service standards is apportioned amongst parties involved (e.g., quality of food on delivery),
d. training support to enable platform workers to explore other regular forms of employment, and
e. medical benefits. 

5.5 In determining the right degree of representation for platform workers in any of these areas, including the option of unionisation, the Committee will consider trade-offs between the interests of platform companies, workers, and users (both businesses and consumers).

The Committee seeks comments on how the interests of platform workers can be better represented and safeguarded. In particular:
 

(i) Suggestions and views on how associations can be strengthened to play a bigger role in representing platform workers, including views on the option of unionisation.  

(ii) Taking into consideration the trade-offs between the interests of various stakeholders, which of the following should be included as areas where associations or unions could represent platform workers in?

a. Resolution of disputes between platform workers and platforms
b. Determination of platform policies, such as earnings structure
c. Apportionment of responsibility for fulfilling service standards to consumers
d. Training support
e. Medical benefits


6 Conclusion

6.1 While the COVID-19 pandemic has made us more reliant on e-commerce, it has also shone a spotlight on platform workers’ unique working conditions and vulnerability. It is therefore timely to look into how we can help platform workers emerge stronger from the pandemic.  

6.2 Ensuring the well-being and long-term resilience of platform workers without undermining the viability of platform services would be beneficial for both workers and platform companies, as well as other businesses and consumers benefitting from their services.

6.3 The Committee recognises that these are complex issues with multiple trade-offs. All stakeholders are encouraged to actively provide their feedback so that the Committee can study these issues carefully before making its recommendations. 

6.4 The Committee will consult widely and seeks to complete its work by the second half of 2022.



1 In 2018, the Tripartite Workgroup on SEPs made recommendations to address common challenges faced by SEPs. These were accepted by the Government and include a Tripartite Standard on Contracting with SEPs, prolonged medical leave insurance and the Contribute-As-You-Earn scheme for Medisave contributions. These are not legislated employment protections.

2 About 3% of our resident workforce could be considered “platform workers”. They mostly work as private hire car and taxi drivers, or drivers for delivery services. While the number of platform workers has risen, the total number of SEPs (excluding employers) has consistently made up 8 – 10% of our resident workforce.

3 In 2019, the median platform worker earned between $1,500 - $2,500 in monthly income. In 2020, the incomes of private-hire car drivers and taxi drivers were significantly affected by COVID-19.