Gender equality and equal pay – the legal environment in Singapore

Singapore has progressed significantly in the last 50 years and has become an advanced economy.  It is credited for having a world-class education system and well-educated workforce.  According to the ‘Labour Force in Singapore Advance Release 2016 Survey’ by the Manpower Research and Statistics Department of the Ministry of Manpower, Singapore, the labour force participation rate (LFPR) for women was 60.4% in 2016.  This rate is pretty impressive compared to our ASEAN neighbors and could be attributed to more women and older (female) citizens in Singapore re-entering the workforce.

Gender equality in workplace could add trillions to US economy

What is disappointing however is that Singapore is still lagging behind in terms of gender equality in the workplace.  According to a recent Straits Times article, female representation on the board of companies in Singapore was a dismal 9.9%!  Also, according to a 2016 Hays Singapore Gender Diversity Report, only 63% of women felt that there was equal pay between genders in Singapore.  What is the reason for this inequality? Do laws in Singapore expressly or implicitly prejudice women in the workforce?

The Constitution of the Republic of Singapore (the “Constitution”) expressly states (under Article 12(1)) that all persons are equal before the law and entitled to equal protection of the law.  The Constitution however does not endorse nor support gender equality. There is also no legislation in Singapore prohibiting sex-based wage discrimination meaning employers have a free reign in determining wages.  In contrast, the US for example has the Lilly Ledbetter Fair Pay Act of 2009 which prohibits sex-based wage discrimination.

Singapore is a contracting party to the United Nations Convention on the Elimination of All Forms of Discrimination against Women (CEDAW).  The CEDAW defines what constitutes discrimination against women and sets up an agenda for national action to end discrimination. Unfortunately, Singapore has excluded certain provisions of the CEDAW (by way of reservations) from applying to itself and this has affected Singapore’s overall commitment to CEDAW and to the elimination of discrimination against women.

The Singapore Code of Corporate Governance 2012 (the “Code”) as well as the Tripartite Alliance for Fair & Progressive Employment Practice (TAFEP) holds some promise.  Paragraph 2.6 of the Code expressly states that company boards should comprise of directors who provide the appropriate balance and diversity of skills, experience, gender and knowledge.  The TAFEP on the other hand strives to promote five principles of fair employment practices.  One of the principles is that companies should recruit and select employees on the basis of merit regardless of gender.

Nevertheless, the reality is that the Code as well as TAFEP have no legally binding effect in Singapore and compliance is not compulsory.  Singapore’s main labour law- the Employment Act (Cap. 91) (”EA”) also does not contain any provisions that safeguard the principle of gender equality.  Things are not all doom and gloom however.

In a recent Straits Time article dated 5 April 2017 and entitled ‘Targets set to lift number of women in boards’, it was mentioned that a Diversity Action Committee (DAC) chaired by Singapore Exchange (SGX) chief executive Loh Boon Chye aimed to double the existing share of board seats for women from 9.9% to 20% by 2020; 25% by 2025 and 30% by 2030.

Also, in a groundbreaking move, the Singapore Parliament debated for the first time on 3 April 2017 and 4 April 2017 a proposal to express more support for women in the workforce in Singapore including amongst others, to discuss ways to reduce the gender imbalance in the Singapore workforce especially at senior management levels.   These moves are a positive step in the right direction but it looks like it will take many more years before gender equality and equal pay is attained in Singapore.  Perhaps Singapore should take a cue from the UK government which, according to a Straits Time article dated 8 April 2017, enacted new legislation on 6 April 2017 to require large companies to publish the average salaries of the men and women they employ with the aim of prompting firms to examine why the gender pay gap exists in the first place!

Kenneth G Pereire is advisory board member for Girls in Tech Singapore and an Associate Director in the Corporate & Commercial Practice of Consilium Law Corporation. His focus areas are in Mergers & Acquisitions (“M&A”) transactions in Singapore and ASEAN and securities regulatory work. He also has considerable experience in assisting technology companies with their legal needs including capital raising documentation, commercial agreements, structuring advice and compliance.

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