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SINGAPORE – Some private sector employers plan not to pay bonuses to their staff this year. This is similar to the government’s announcement that no bonuses would be paid to public officials at the end of the year, given the weakening of the economic outlook caused by the Covid-19 pandemic.
Others, however, go ahead with their plans to pay their staff a bonus in addition to the annual salary supplement, or 13th month bonus.
Nick Lee, a director at IT services firm AIT Technologies, said his firm has suffered losses this year as client projects were delayed amid the coronavirus outbreak. You will not be able to pay your staff an annual bonus or the 13th month bonus.
“We already had to lay off two people earlier this year, but most of our staff have not suffered pay cuts. Saving our company is the priority now,” he said.
Dr. Kevin Cheong, CEO of the local Sentosa 4D AdventureLand attraction, also said that he would not be able to pay a bonus to the staff.
“With nearly half of annual revenue wiped out overnight, we are all struggling, even after we have reopened our doors to visitors.”
Dr. Cheong, who is also president of the Singapore Attractions Association, said that he would not be surprised to see most tour operators do the same.
The two men responded to yesterday’s announcement from the Public Service Division (PSD) that Singapore’s 85,000 civil servants will not receive any year-end bonuses this year.
This means that they will not receive any annual variable component throughout the year, as the mid-year bonuses were also not paid out earlier this year.
Public officials will continue to receive the annual non-pensionable allowance, or thirteenth month premium, of a month’s pay.
Mr. Dainial Sani Lim, group director of immigration consultancy Cayman Group Holdings, will continue to pay the 13th month bonus to his staff and also plans to continue paying annual performance bonuses.
Although revenue has been slightly affected by Covid-19, your company has not been as affected.
“Our bonus is tied to our company’s performance, but due to Covid-19, I lowered the group’s performance target by approximately 20 percent … If we hit this target, we will still be able to deliver bonuses,” said Mr. Lim . “Even though times are tough, everyone still has to pay the bills.”
Ho Meng Kit, executive director of the Singapore Business Federation, said that the public sector’s failure to pay the year-end bonus is a signal for the private sector to be prudent in managing its wage costs. He noted that the outlook for companies over the next year remains highly uncertain.
“In light of (this), we would expect companies to prioritize managing their wage costs,” he said.
Meanwhile, PSD said it will continue to give special consideration to lower-paid civil servants, with around 2,400 lower-paid employees receiving a one-time payment of $ 1,200.
Mr. Raman Kathavarayan, general secretary of the Amalgamated Union of Skilled Daily Public Workers, applauded the move to provide this payment to lower-paid workers as it would give them much needed encouragement.
Mr. Sanjeev Kumar Tiwari, General Secretary of the Amalgamated Union of Public Employees, said the union appreciates that the 13th month bonus has been maintained for all civil servants.
An official in his 30s who declined to be named said he was not surprised by the news about the year-end bonus.
“(This is) because year-end bonuses have always been tied to the economy.” However, he hopes his performance bonus, which is paid in March, will not be affected.
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