United Nations Public Service Awards Case Studies

In late 2008, a severe financial crisis sparked off an unprecedented global economic crisis, resulting in a pronounced deceleration of economic activity. Many countries went into recession. Unemployment rose as companies cut jobs and retrenchments became a regular phenomenon worldwide.

Due to its heavy dependence on trade and exports, the crisis hit Singapore hard. In a country where almost everything produced is exported, falling global demand – especially in the US and Europe – reduced exports and manufacturing activity by a third. In November 2008, Singapore's DBS Group, Southeast Asia's biggest bank by assets, announced that it was laying off 900 staff to cut costs. At PSA Singapore, the world’s largest container transshipment hub, two-thirds of its forklift cranes stood idle, as trade volumes became so dismal that containers were being shipped from China to Europe for free. As the decline in global economic activity steepened and spilled over to key sectors of the Singapore economy, the Singapore Ministry of Trade and Industry (MTI) cut its GDP forecasts twice, to between -5% to -2%. MTI second permanent secretary Ravi Menon noted that the Singapore economy was going through its sharpest, deepest and most protracted recession on record.

The impact on the labour market was significant. As business activity dropped drastically, companies had to relocate their business, downsize headcounts and re-structure their operations. This led to serious concerns that there would be a record level of retrenchments affecting the livelihood of many Singaporeans.

With the economic outlook bleak and especially conditions in the labour market threatening to worsen, Singapore’s tripartite stakeholders – unions, employers and the government – needed to take prompt action together.

What is the initiative about? (the solution)
Singapore swiftly responded to the economic crisis through its unique tripartite collaboration. [Apart from National Trades Union Congress (NTUC) which represents the workers, the tripartite partners are the Ministry of Manpower (MOM) and Singapore National Employers Federation (SNEF), which represents employers and businesses.] In Nov 2008, a Tripartite Taskforce on Managing the Economic Downturn, led by the Ministry of Manpower and comprising key tripartite leaders, was set up to tackle the downturn. Later that month, the Taskforce issued a set of Tripartite Guidelines recommending employers to manage costs by adjusting wages and/or implementing flexi-work arrangements (e.g. shorter work-week, temporary layoffs). This helped businesses to cut costs and save jobs. The Guidelines also advised employers to consider retrenchment only as the last resort. A voluntary retrenchment monitoring system was set up to assist employers with their retrenchment processes and affected workers with looking for alternative employment. At the same time, the taskforce worked with a government agency, the Workforce Development Agency (WDA), to develop the Skills Programme for Upgrading and Resilience (SPUR), a two-year programme providing enhanced financial support for companies and workers to tap on skills-upgrading programmes. Through SPUR, businesses save on manpower and training costs while building capabilities for the economic recovery; workers retain their jobs and enhance their employability. SPUR also caters to retrenched workers. As at Dec 2009, some 264,000 workers had committed to attend SPUR training. Of these, at least 148,000 had commenced or completed training. To encourage employers to adopt the Guidelines and tap on SPUR, the tripartite partners embarked on numerous outreach activities. These activities allowed the Taskforce to gather feedback and refine the initiative in a timely manner. For example, the Taskforce revised the Nov 2008 MEM Guidelines in May 2009 and increased the number of SPUR courses from 100+ to 2000+. MOM/WDA working with the tripartite partners also introduced SPUR-Jobs to encourage recruitment and retention of SPUR trainees. In addition to helping rank-and-file workers, MOM/WDA further launched the Professional Skills Programme Traineeships to help PMEs as well as graduates who were affected by the downturn to shift to growth sectors. In mid-2009, the possibility of an Influenza A (H1N1-2009) pandemic emerged and threatened to derail any economic recovery. Again, the tripartite partners quickly responded to introduce advisories on workplace measures to tackle the situation. The tripartite downturn initiative has been effective and well-received by employers, unions and workers. Apart from cutting costs and saving jobs, many companies also tapped on SPUR to send their workers for training. This resulted in retrenchments dropping sharply, from 12,760 in Q1 2009 to 5,980 in Q2 2009. Unemployment stabilised at 3.3-3.4%. Overall, Singapore lost fewer jobs than it did during the 1997 Asian Economic Crisis. Employment rate for those aged 55-64, traditionally a vulnerable group, also remained stable at 54%.

Who proposed the solution, who implemented it and who were the stakeholders?
Facing the unprecedented economic crisis, the tripartite partners came together quickly to discuss how they could address the downturn’s impact on businesses and workers. These discussions led to the formation of the Tripartite Taskforce to develop measures to deal with workplace issues arising from the recession. The Taskforce met regularly to decide on major economic and labour measures to address the crisis. WDA contributed to the efforts by developing SPUR in consultation with the tripartite partners. As part of the tripartite downturn initiative, the partners tapped on the Singapore Tripartism Forum (STF) platforms to broadcast the cost-cutting measures to a wider audience and encourage adoption. The STF, jointly set up by the tripartite partners, was designed to broaden, deepen and strengthen the spirit of tripartism through a structured framework. Through this branding platform, the tripartite partners organised a series of dialogues for tripartite leaders to engage various employer associations and chambers of commerce, including the international, German, British, American, Chinese and Indian chambers. On 22 Feb 2009, the tripartite partners organised an STF dialogue during which Prime Minister Lee Hsien Loong rallied a 600-strong audience comprising unionists, employers and government officials to strengthen tripartite cooperation to overcome the downturn and emerge stronger from the crisis. The tripartite partners also reached out to other stakeholders, such as non-unionised SMEs, trade associations and industrial unions, to brief them about the Guidelines. In March 2009, the tripartite partners stepped up outreach efforts by distributing an downturn package explaining the Guidelines and various measures on managing excess manpower (including SPUR) to CEOs of all companies in Singapore with at least 10 employees. In April 2009, the tripartite partners set up Tripartite Upturn Strategy (TRUST) Teams comprising experienced officers from MOM, SNEF and NTUC to directly engage companies and sectors affected by the downturn. The TRUST Teams have assisted over 600 companies and were expanded to meet increasing demand.

Describe how and when the initiative was implemented by answering these questions
a. What were the strategies used to implement the initiative? In no more than 500 words, provide a summary of the main objectives and strategies of the initiative, how they were established and by whom.
At the outset, the tripartite partners were clear that the best way to give Singaporeans confidence during this crisis was to help businesses remain viable and workers to stay employed so as to minimise any financial hardship that could impact them and their families. Therefore, the objective of the tripartite downturn initiative was to cut costs to save jobs, rather than to cut jobs to save costs. Retrenchment should be considered only as the last resort. With this in mind, the tripartite partners embarked on a three-pronged approach. 1. Help employers manage costs to save jobs. The Taskforce worked with other government agencies to ensure that measures were coordinated to help tide businesses and workers through the crisis. Government announced a Resilience Package focused on helping businesses to retain workers, by helping them save on manpower costs and strengthen their cash-flow, and by enhancing their competitiveness. This was mainly aimed at shoring up supply and keeping jobs, and provided more support and confidence for the domestic economy than fiscal efforts would. A key measure was the Jobs Credit Scheme, which provided a monetary incentive for employers to retain local workers. In addition, the tripartite partners consulted closely together to develop the Tripartite Guidelines on Managing Excess Manpower, which set the parameters for employers to implement cost-cutting measures e.g. implement shorter work-week and temporary layoff, adjust wages. 2. Build capability through skills development. The Taskforce also worked with WDA to develop SPUR, which was launched in Dec 2008 and aimed to help employers cut costs to save jobs and to strengthen the Singapore workforce’s capabilities for the eventual upturn. For employers, SPUR provides enhanced course fee support so that they can send excess manpower for training. In addition, SPUR also covers “absentee payroll”, subsidising the salary of a worker while he/she is absent from work on training. (The subsidy is 90% of a worker’s salary, capped at 10 SGD/hour). SPUR courses are also available for individuals e.g. retrenched employees. WDA has exponentially grown the number of courses covered under SPUR, which now cover human resource, healthcare and precision engineering. 3. Reach out and garner feedback. Through various outreach activities, the tripartite partners sought to build awareness, buy-in and support for the entire spectrum of downturn measures. A total of 43 briefings / dialogues / events were organised, reaching more than 9,500 participants. The partners also tapped on the STF, media and other innovative methods to multiply its outreach and to derive feedback to refine and improve policy decisions. This ensured that the tripartite downturn initiative remained updated and relevant.

b. What were the key development and implementation steps and the chronology? No more than 500 words
Key developments in chronological order were as follows: i. Once the economy started to trend downwards in the last quarter of 2008, the tripartite partners quickly engaged each other and formed the Tripartite Taskforce on Managing the Economic Downturn in November 2008. ii. The Taskforce commenced consultation to formulate the Tripartite Guidelines on Managing Excess Manpower, which recommended companies to cut cost and save jobs, and to consider retrenchment only as a last resort. The Guidelines were issued in Nov 2008 and revised in May 2009 in response to the worsening economic situation and feedback from the companies and industries. iii. MOM set up the voluntary retrenchment monitoring system to monitor and provide timely information on retrenchments. Affected companies responded positively and voluntarily reported retrenchments in advance, particularly those involving large numbers of workers. This enabled the tripartite partners to follow up to assist companies with their retrenchment processes and refer retrenched workers for help in securing training and/or find alternative employment. iv. To help companies implement the Guidelines and other measures, the tripartite partners organised many outreach events to engage CEOs, HR directors, unionists and government officials on the various measures recommended in the MEM Guidelines. For example, on 22 Feb 2009, the Prime Minister held a public dialogue with more than 500 employers and union leaders on the need to come together to address the challenges brought about by the downturn. The impact of the outreach activities were multiplied through: a. Leveraging on STF. Events with employer organisations allowed swift broadcast of the measures to the relevant audiences. Tripartite partners also organised dialogues to engage the various chambers of commerce. b. A high-signature “downturn package” addressed to company CEOs. The tripartite partners disseminated this to all companies with at least 10 employees, with an accompanying letter signed off by the three key tripartite leaders, to stress the importance of the need to cut costs to save jobs. The package included a survey on how companies have been affected by the downturn and how they are using the cost-cutting measures, and a booklet on SPUR and other downturn measures. c. TRUST Teams. Tripartite partners set up TRUST Teams in Apr 2009 to provide customised assistance to companies, especially non-unionised SMEs. Experienced representatives from the tripartite partners visited companies ranging from MNCs to local SMEs. d. A 7-day 24-hour hotline. MOM set this up quickly to cater to any queries on MEM measures and retrenchment issues.

c. What were the main obstacles encountered? How were they overcome? No more than 500 words
One of the tripartite partners’ main challenges was in reaching the non-unionised sector, especially the small and medium enterprises. These smaller companies are usually not members of SNEF or other employer associations or chambers of commerce, and because they were not unionised, NTUC could not reach out to their workers. This meant that these employers and employees might not be aware of the tripartite downturn initiative and would not benefit from it. The tripartite partners overcame this challenge through innovative methods. One approach was to disseminate a comprehensive downturn package to CEOs of companies with at least 10 employees. The second approach was to form TRUST Teams to broaden outreach, engage and provide customised assistance to needful companies, which had requested for assistance and advice on implementing downturn measures. Another challenge was for tripartite partners to reach consensus on the extent of the cost-cutting measures to be recommended in the Guidelines. The partners would also need to get buy-in from their constituents. An example was the implementation of no-pay leave. Employers wanted to implement no-pay leave to mange costs, but unions / workers prefer to avoid such measures which could result in financial hardship especially for low-wage workers. The Taskforce consulted extensively and managed to reach consensus quickly on the key principles to implement no-pay leave. This includes adopting the principle of mutual sacrifice, and having senior management lead by example when implementing no-pay leave. Tripartite partners particularly the unions helped to carry the ground and the Guidelines were well-received and widely implemented. The tripartite collaboration helped companies to cut costs stay viable and workers to remain employed. With the introduction of SPUR came another major challenge: urgently ramping up capacity to meet the projected increase in demand for training places. SPUR provides enhanced course fee subsidies and absentee payroll, which encourage many companies with excess manpower to send their workers for training. Working closely with NTUC, SNEF and other industry stakeholders, and acting on industry feedback received through their outreach efforts, MOM/WDA increased the 100+ SPUR courses available at the start to more than 2000 and doubled training places from 110,000 to 220,000. MOM/WDA expanded SPUR to cover tertiary institution courses (e.g. polytechnic courses) as well as Workforce Skills Qualifications (WSQ) courses, which are competency-based and allow progression from certificates to graduate diplomas. By Dec 2009, a total of 264,000 workers from 4,000 companies had benefited from SPUR.

d. What resources were used for the initiative and what were its key benefits? In no more than 500 words, specify what were the financial, technical and human resources’ costs associated with this initiative. Describe how resources were mobilized
The Tripartite Taskforce, which comprised the senior tripartite leaders, committed much time and efforts to formulate measures to address the economic crisis, with the government as facilitator. Both SNEF and NTUC also had to devote many hours to consult with their members and seek feedback, so that the tripartite leaders could carry the ground with the various downturn measures. On the part of the government, MOM redeployed some officers to take on new roles, in addition to their core duties of handling labour disputes. Officers were tasked to monitor retrenchments and provide advice to retrenching companies. MOM’s statutory board WDA also stepped up its efforts to focus on re-skilling and up-skilling workers to improve their employability. Taskforce members also had to redeploy representatives to set up the TRUST Teams to provide customised advice and services to needful employers and to maintain close communication with members and constituents. This approach has greatly contributed towards a more strategic, coordinated and timely handling of a wide spectrum of issues that arose from the downturn. For example, the rolling out of the Guidelines for implementation, reaching out to employers and employees to raise awareness about downturn measures; and assisting companies with retrenchment processes and helping workers re-skill and find jobs. The willingness and ability of the tripartite partners to work together and commit resources to overcome adversity clearly demonstrated Singapore’s resolve to fight what was likely its worst-ever recession. The Singapore government supported the downturn taskforce’s efforts by setting aside 20.5 billion SGD for a Resilience Package in its 2009 Budget, to help see the country through this period of exceptional difficulty. The Package which included funding for Jobs Credits and SPUR, aimed to save as many jobs as possible and help viable companies stay afloat. It also aimed to prepare the Singapore business community and workers to emerge stronger and more resilient from the downturn.

Is the initiative sustainable and transferable?
Despite the green shoots, the tripartite downturn initiative remains active. The MEM Guidelines continue to apply to business affected by the downturn. SPUR has one more year to run. In response to industry requests for an extension to the Jobs Credit scheme, the Government has also announced that the scheme would be gradually stepped down before being discontinued in Jun 2010. TRUST teams continue to assist needful companies, although resources will now be diverted to help recovering companies manage long-term challenges. In recognition of the improving economic conditions, the tripartite partners further formulated a Tripartite Advisory on Managing Manpower Challenges. The advisory recommends that companies recovering from the downturn and no longer confronted with excess manpower could review the need for existing cost-cutting measures and focus on long-term manpower challenges, such as enhancing productivity. It also suggests that employers recognise employees for their support and sacrifices they made during the downturn. The main components of the tripartite downturn initiative are replicable in other countries. SPUR and other training subsidy programmes can be transferred, with resources and the appropriate modifications to suit local conditions. Outreach methods may need to be customised to take into account geographical, technological and infrastructural differences. On the other hand, the spirit of tripartite collaboration, which enabled us to formulate this rapid and robust response to the downturn, is not so easily replicated / sustained. But it is not an accident. Singapore’s model of tripartism has been built up over the past few decades, based on shared responsibility, the common goal of nation building and mutual trust among the tripartite partners. And it has served us well. In an ILO publication on “Blunting neoliberalism: Tripartism and economic reforms in the developing world” (to be released on 5 Jan 2010), Singapore is cited as a "good example of how tripartism helped to reconcile efficiency and equity”. Singapore has used tripartite wage setting since the 1970s to promote moderate wage growth and wage flexibility, move the economy into higher value-added sectors and respond to external shocks. Singapore’s tripartite collaboration has also been crucial in its skills development programme as well as SPUR, which formed a key part of its tripartite downturn initiative. So that we do not lose this vital advantage, the tripartite partners will continue to work together to strengthen, enhance and sustain the spirit of tripartism. This competitive advantage has enabled Singapore to cope with adversity in bad times and share the benefits of growth among employers and workers in good times. We also intend to take stock of the evolution of harmonious industrial relations and tripartism in Singapore and identify the success factors, so that future generations and other countries can benefit. In sharing the positive experiences of the tripartite downturn initiative at this platform, we also hope to demonstrate how tripartite collaboration can work to bring about a win-win-win outcome for workers, employers and the economy.

What are the impact of your initiative and the lessons learned?
The tripartite downturn initiative has brought about positive results. Through the efforts of the tripartite partners, employers and employees have worked together to adopt cost-cutting measures to stave off massive job losses and retrenchments. By Q2 2009, retrenchments have dropped sharply to 5,980 from 12,760 in Q1 2009. Unemployment has also stabilised at 3.3-3.4%. The latest MOM survey showed that 62% of private establishments were aware of the Tripartite Guidelines and 76% were aware of SPUR. More importantly, because of the initiative, seven out of ten employers which had planned to retrench decided to postpone their retrenchment decisions or reduce the number of workers affected. The initiative has enabled employers to cut costs and save jobs, and reduce retrenchments to the minimum. Singapore lost significantly fewer jobs than it did during the 1997 Asian Financial Crisis. Employment rate for those aged 55-64, traditionally a vulnerable group, remained stable at 54%. As of Dec 2009, some 264,000 workers have committed to attend SPUR training. Of these, at least 148,000 workers have already commenced or completed training. Extensive engagements amongst the tripartite partners during this downturn further strengthened trust and understanding, fostering greater teamwork and closer labour-management relations. The downturn experience emphasised the importance of trust among the tripartite partners, which enabled the Taskforce to formulate swift and effective response to the crisis. This would serve Singapore in good stead as companies and workers work together to capitalise on growth opportunities as the economy recovers. At a recently concluded ASEAN seminar on Tripartism and Social Dialogue initiated by Singapore and supported by the International Labour Organisation (ILO), Singapore shared with other ASEAN delegates her experience on how its tripartite partners have worked together to tackle the adverse impact of the economic slowdown on Singapore. Included in the seminar programme was a visit to a unionised MNC in the semiconductor industry, STMicroelectronics, whose business and workers benefited from the tripartite downturn initiative. STMicroelectronics shared with the delegates how the company was able to work with tripartite partners to successfully implement several downturn measures to cut costs. The company also presented the substantial savings it enjoyed via the Jobs Credit and SPUR schemes. The delegates commended the decisive and prompt responses taken collectively by the tripartite partners to effectively deal with the economic crisis. Overall, the strong tripartite collaboration has helped companies to overcome adversities and businesses to remain viable. At the same time, the downturn measures assisted employees, especially low-wage workers, to remain employed and therefore minimised financial hardship. To ride on the opportunities as Singapore’s economy recovers, tripartite partners are working with companies and employees to look beyond short-term issues to also focus on long-term strategies. The strong tripartite partnership would ensure that this recovery is sustainable and that Singapore emerges well prepared to deal with the challenges and opportunities ahead. This will further strengthen the confidence of businesses and investors, raise national competitiveness and capability to the next level, and ensure that Singapore continues to achieve sustainable economic growth and social progress.


Institution Name:		Ministry of Manpower
Institution Type:		Government Department
Contact Person:		Andy Hue
Title:		Assistant Director (Organisational Excellence)
Telephone/ Fax:
Institution's / Project's Website:
E-mail:		andy_hue@mom.gov.sg
Address:		18 Havelock Road
Postal Code:		Singapore 059764
City:		Singapore
State/Province:		Singapore
Country:		Singapore

The Problem

Solution and Key Benefits

Actors and Stakeholders

(a) Strategies

(b) Implementation

(c) Overcoming Obstacles

(d) Use of Resources

Sustainability and Transferability

Lessons Learned

Contact Information