01 PROGRESSIVE MODEL

SKILLS CONTENTS WHAT IS PROGRESSIVE UPGRADING WAGE MODEL?

WHAT IS PROGRESSIVE WAGE MODEL? 01 As Singapore faces a new reality of slower growth and restructures itself towards a high productivity economy, new mindsets must be undertaken to HOW DO THE FOUR LADDERS WORK TOGETHER? 02 overcome the impending challenges. PRODUCTIVITY Businesses need to improve the IMPROVEMENT productivity of their operations through WHAT IS IN IT FOR COMPANIES? 03 innovation, as well as attract, retain and make better use of every worker. To grow in a sustainable way, employees THREE KEY MYTHS 04 need to upgrade skills, improve productivity and take on higher value . The Progressive Wage Model (PWM) is HOW CAN COMPANIES GET STARTED? 06 a four-in-one model of skills upgrading, productivity improvement, career ADVANCEMENT advancement and wage progression. It enables companies to make better RESOURCES 08 use of manpower and pay higher wages, commensurate with larger scopes CAREER and higher productivity levels. PATH NOTES 09 The PWM is for workers at all levels, for all sizes of companies, across all industries and sectors. It has been implemented for Professionals, PROGRESSION Managers and Executives (PMEs) in sectors including hospitality, healthcare and petroleum, as well as low-wage sectors such as cleaning and security. 02 03 PROGRESSIVE WAGE MODEL

HOW DO THE FOUR LADDERS WHAT IS IN IT FOR COMPANIES? WORK TOGETHER?

The PWM illustrates a clear progression PROGRESSIVE WAGE MODEL PROGRESSIVE WAGE of wages with skills upgrading and career progression; allowing pay increase to move in tandem with productivity gains. FOUR All four ladders are integral and equally important components of the PWM, LADDERS and must go hand in hand to ensure Future Ready Company sustainable wage increase. Innovation and technology will be key drivers for future ready Future Ready Workers If wages go up without an eventual rise companies. Companies need to Future ready companies in productivity, there will be an erosion reinvent themselves with vision have to be supported of business competitiveness and and capabilities to deal with the by future ready talent subsequent loss of jobs as the business future challenges. PWM is a and capabilities. With a downsizes itself and eventually ceases to continuous process that requires structured framework for all exist. At the same time in the domestic companies to constantly seek workers to reskill and upskill, market, consumer prices will rise and will process improvements, job the workforce will be better hurt everyone. It is not a sustainable or redesign and innovation to trained, agile and adaptable acceptable solution either for businesses capture new opportunities. to the future requirements. to maintain competitiveness and profits by keeping wages down.

CAREER

Better Attraction and Retention More Sustainable of Workers Wage Increase A clear career progression pathway Wage increases will be linked will provide workers with more to productivity improvements clarity on career advancement to ensure the sustainability opportunities, helping to attract and competitiveness of the and retain talents. company over the long term. 04 05 PROGRESSIVE WAGE MODEL MYTH THREE KEY MYTHS 2 PWM requires licensing for implementation. FACT PWM does not require licensing to be implemented. However, in sectors plagued by low wages and low skills, PROGRESSIVE WAGE MODEL PROGRESSIVE WAGE MYTH PWM needs to be mandated through a licensing framework to 1 PWM is . protect the vulnerable workers. So far, only the cleaning industry has mandated PWM through FACT a licensing framework. Companies across different sectors PWM is NOT equal to Minimum Wage. (e.g. hospitality, services and healthcare) which have seen the By definition, a minimum wage is the lowest hourly, daily or advantages of PWM have started their own monthly wage point that employers must legally pay to workers. journey on PWM. PWM, on the other hand, stipulates a progressive wage structure that stretches beyond a single legislated wage point. In countries with a minimum wage, some employers refuse to pay beyond the legislated minimum wage. This stagnation MYTH hurts the workers as well as the company, as workers will not be motivated at work and companies are less driven 3 PWM assures promotion once the worker attains the to be innovative. skill set specified for the position. FACT Promotion to a higher grade is based on merit. Acquiring the skill set enables the workers to better position themselves for career advancement. PWM requires clarity in skill competencies for workers to do the job well, and transparency on promotion criteria to meet the aspirations of the workers. 06 07 PROGRESSIVE WAGE MODEL

HOW CAN COMPANIES GET STARTED?

STEP 3 PROGRESSIVE WAGE MODEL PROGRESSIVE WAGE • If your company is Growth Programme unionised, work together (IGP) funding from with your union to NTUC’s Employment and brainstorm ideas to Employability Institute manage these gaps. (e2i) to kick start the Set up a workgroup, PWM journey. develop an action plan • If your company is STEP 2 by prioritising which non-unionised, you can ladder to work on first approach NTUC’s e2i for JOBS Identify the gaps and explore available a consultation. Productivity resources, e.g. Inclusive • Can there be further multi-skilling, multitasking or job Wages • Are your workers aware STEP 1 enhancements? • Was a salary review done of the required skill set to • Can the jobs be made in the last three years in move up the career path? Every company and every easier, smarter and safer your organisation? sector is unique with their Career through adoption of • Do you have a own set of challenges. • Are clear career technology? competitive wage Review your business pathways in place in your structure in place? operations, the areas • Is there a formal organisation? that need enhancement productivity management Skills • Do your workers face and are of priority. structure established • Are there relevant obstacles in moving up within your organisation available that enable their career paths? to ensure productivity workers to upskill, E.g. pre-requisite of improvements e.g. Workforce Skills academic qualifications. are continuously Qualification (WSQ) implemented? courses?

REVIEW THIS FRAMEWORK CONTINUOUSLY 08 09 PROGRESSIVE WAGE MODEL

RESOURCES NOTES PROGRESSIVE WAGE MODEL PROGRESSIVE WAGE

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