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Industrial Relations (Amendment) Act is enacted 14th Aug 1968

The Industrial Relations (Amendment) Act, 1968,[1] was a piece of legislation that sought to clearly define the management rights of employers over employees through changes to the Industrial Relations Ordinance, 1960.[2] The act was passed along with the Employment Act, 1968, which was a labour law that standardised and regulated the terms and conditions of employment for all categories of workers.[3]

Creating jobs and attracting investments
Both the Industrial Relations (Amendment) Act and the Employment Act attempted to provide an integrated legal framework that would regulate employer-employee relations with the aim of attracting new investments to Singapore and increasing the efficiency of companies.[4] At the time, Singapore was experiencing exceptional population growth in the post-war years,[5] which resulted in growing unemployment.[6] Along with the anticipated loss of national income and jobs that would result from the British military withdrawal from Singapore by 1971, the creation of opportunities for jobs and investments was essential for the nation’s economic survival.[7]

Fundamental to attracting investments, however, was stable industrial relations between employers and employees. Work stoppages due to industrial disputes had to be quickly addressed.[8] In 1961, the United Nations Industrial Survey Mission to Singapore highlighted the urgent need to establish stable relations between employers and employees.[9] On the issue of management rights, the mission recommended that employers should be free to hire and fire workers based on their level of productivity and the economic needs of the company. The mission believed that restrictive employment practices would discourage investors from investing and establishing industries in Singapore.[10]

Introduction of the bill
It was with such economic objectives in mind that the Industrial Relations (Amendment) Bill was first presented by then Minister for Foreign Affairs and Labour S. Rajaratnam in parliament on 10 July 1968.[11] Its introduction coincided with the second reading of the Employment Bill, which dealt with workers’ terms of employment.[12] According to Rajaratnam, both bills were an attempt to “rationalise [the] employer-employee relationship with a view to attracting new investments and increasing the efficiency of [Singapore’s] trading and industrial enterprises”.[13]

Restoring managements rights
The Industrial Relations (Amendment) Bill sought to restore management rights to employers through several proposed changes to the Industrial Relations Ordinance, 1960. First, the bill contained an amendment that would prevent any trade union consisting of employees in subordinate positions from representing employees in managerial or executive positions. Instead, there would be separate unions for different categories of employees.[14]

Second, the bill included a list of management functions in which unions would have no power to negotiate. These functions included the promotion, internal transfer, recruitment, retrenchment, dismissal and reinstatement of employees as well as the allocation of duties and tasks to employees. This clause was introduced to allow employers to make the necessary manpower adjustments to facilitate business efficiency and in times of changing business conditions.[15]

Third, the bill proposed to amend the duration that a collective agreement would be effective to a minimum of three years and a maximum of five years. The duration was an increase over the previous range, which was between 18 months and three years. The extension was justified on the grounds that the longer time frame would enable stability in employment terms, which would lead to more efficient management practices as investors would then be able to plan further ahead.[16]

Fourth, the bill sought to limit employment benefits, including sick and annual leave, which employers of certain approved industries would have to give to their workers. A maximum ceiling for employment benefits would be set based on the provisions found in Part IV of the proposed Employment Act. This limit would apply to all approved pioneer industries with effect from 1 January 1968 and would last for a period of five years following the commencement of business operations.[17]

Fifth, the bill stipulated that the Industrial Arbitration Court would have no right under most circumstances to get involved in disputes concerning the dismissal or reinstatement of an employee. Instead, the Minister for Labour would review dismissal cases, and where appropriate, order an employer to reinstate or pay compensation to the affected worker. Employers who failed to comply with the minister’s orders would be penalised.[18]

Finally, the bill set out the circumstances under which a trade union officer may apply for paid leave in order to carry out his union duties. Paid leave would only be granted if the officer needed time off to attend to matters concerning union members and his employer. This was to prevent an employer from having to pay for the absence of a union officer in cases where the officer was attending to matters that did not concern the employer.[19]

Passing of the legislation
The second reading and discussion of the Industrial Relations (Amendment) Bill in parliament spanned two days from 31 July to 1 August 1968.[20] The bill was committed to a committee of the House, read a third time and passed on 1 August.[21] The president assented to the bill on 6 August 1968 along with the Employment Bill.[22] The Industrial Relations (Amendment) Act finally came into effect on 15 August 1968 on the same day as the Employment Act.[23]

Creating a low-cost and productive workforce
Government control over the labour force was secured following the enactments of both acts in 1968. The two new labour laws had the desired effect of creating a productive, low-cost and compliant labour force while creating opportunities for investments and job creation in Singapore.

The number of man-days lost through industrial stoppages also dropped drastically following the enactment of the two acts. In 1968, over 11,400 man-days were lost in four work stoppages. From 1978 onwards, there was hardly any sign of industrial unrest in Singapore.[24] Such favourable labour conditions soon attracted a steady flow of foreign capital into Singapore. Direct foreign investment in the manufacturing sector increased from S$151 million in 1968 to S$1,097 million in 1978.[25] At the time of the British military withdrawal from Singapore in 1971, the numerous jobs created by foreign investments had resulted in a tight labour market in which 12 percent of the labour force consisted of immigrant workers.[26]

References
1. Republic of Singapore. Government Gazette. Acts Supplement. (1968, August 15). Industrial Relations (Amendment) Act, 1968 (No. 22 of 1968, pp. 229–238). Singapore: Government Printing Office. Call no.: RCLOS 348.5957 SIN.
2. Singapore. Supplement to the laws of the State of Singapore. (1960, February 25). Industrial Relations Ordinance, 1960 (Ord. 20 of 1960, pp. 164–200). Singapore: Government Printing Office. Call no.: RCLOS 348.5957 SIN.
3. Republic of Singapore. Government Gazette. Acts Supplement. (1968, August 6). Employment Act, 1968 (Act 17 of 1968, pp. 147-207). Singapore: Government Printing Office. Call no.: RCLOS 348.5957 SGGAS.
4. Singapore. Parliament. Parliamentary Debates: Official Report. (1968, July 31). Second Reading of the Industrial Relations (Amendment) Bill (Vol. 27, cols. 733–734). Singapore: Government Printing Office. Call no.: RCLOS 328.5957 SIN.
5. Saw, S. H. (2007). The population of Singapore (p. 15). Singapore: Institute of Southeast Asian Studies. Call no.: RSING 304.6095957 SAW.
6. Labour Department. (1961). Annual Report of the Labour Department, 1959, p. 7. Singapore: Government Printing Office. Call no.: RCLOS 331 SIN.
7. Singapore. Parliament. Parliamentary Debates: Official Report. (1968, August 1). Second Reading of the Industrial Relations (Amendment) Bill (Vol. 27, col. 787). Singapore: Government Printing Office. Call no.: RCLOS 328.5957 SIN.
8. Parliamentary Debates: Official Report, 31 Jul 1968, Second Reading, Vol. 27, cols. 735–736.
9. The United Nations Industrial Survey Mission. (1963). A proposed industrialization programme for the State of Singapore (p.117). [Singapore]: United Nations Commissioner for Technical Assistance, Department of Economic and Social Affairs. Call no.: RCLOS 338.095951 UNI.
10. United Nations Industrial Survey Mission, 1963, p. 109.
11. Singapore. Parliament. Parliamentary Debates: Official Report. (1968, July 10). First Reading of the Industrial Relations (Amendment) Bill (Vol. 27, col. 463). Singapore: Government Printing Office. Call no.: RCLOS 328.5957 SIN.
12. Singapore. Parliament. Parliamentary Debates: Official Report. (1968, July 10). Second Reading of the Employment Bill (Vol. 27, cols. 470–487). Singapore: Government Printing Office. Call no.: RCLOS 328.5957 SIN.
13. Parliamentary Debates: Official Report, 31 Jul 1968, Second Reading, Vol. 27, col. 733.
14. Parliamentary Debates: Official Report, 31 Jul 1968, Second Reading, Vol. 27, cols. 736–737.
15. Parliamentary Debates: Official Report, 31 Jul 1968, Second Reading, Vol. 27, cols. 737–739.
16. Parliamentary Debates: Official Report, 31 Jul 1968, Second Reading, Vol. 27, cols. 739–740.
17. Parliamentary Debates: Official Report, 31 Jul 1968, Second Reading, Vol. 27, col. 740.
18. Parliamentary Debates: Official Report, 1 Aug 1968, Second Reading, Vol. 27, col. 761.
19. Parliamentary Debates: Official Report, 1 Aug 1968, Second Reading, Vol. 27, cols. 762–763.
20. Parliamentary Debates: Official Report, 31 Jul 1968, Second Reading, Vol. 27, cols. 733–740; Parliamentary Debates: Official Report, 1 Aug 1968, Second Reading, Vol. 27, col. 761–790.
21. Singapore. Parliament. Parliamentary Debates: Official Report. (1968, August 1). Committed in Committee, Reported and Third Reading of the Industrial Relations (Amendment) Bill (Vol. 27, col. 790). Singapore: Government Printing Office. Call no.: RCLOS 328.5957 SIN.
22. Singapore. Parliament. Parliamentary Debates: Official Report. (1968, December 3). Assents to Bills Passed (Vol. 28, cols. 5–6). Singapore: Government Printing Office. Call no.: RCLOS 328.5957 SIN.
23. Government Gazette. Acts Supplement, 15 Aug 1968, Act 22 of 1968, p. 229; Republic of Singapore. Government Gazette. Subsidiary Legislation Supplement. (1968, August 12). The Employment Act, 1968 (S 237/1968, p. 471). Singapore: Government Printing Office. Call no.: RCLOS 348.5957 SGGSLS.
24. Huff, W. G. (1994). The economic growth of Singapore: Trade and development in the twentieth century (p. 295). Cambridge; New York: Cambridge University Press. Call no.: RSING 338.959570094 HUF.
25. Huff, 1994, p. 416.
26. Turnbull, C. M. (2009). A history of modern Singapore, 1819–2005 (p. 312). Singapore: NUS Press. Call no.: RSING 959.57 TUR-[HIS].

 

The information in this article is valid as at 2014 and correct as far as we are able to ascertain from our sources. It is not intended to be an exhaustive or complete history of the subject. Please contact the Library for further reading materials on the topic.

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