Daily Lessons from Life 16 October 2009

"Labour chief: Let's end practice of pay cut at 60
NTUC is likely to argue vigorously for an end to the practice allowed by The Retirement Age Act. -->Fri, Oct 16, 2009 The Straits Times

SINGAPORE companies were put on notice yesterday that the labour movement would be pushing to end their widespread practice of cutting the pay of workers when they turn 60.


More than 80 per cent of unionised companies do it and often, they cut the maximum 10 per cent allowed under the law.

But it is time to review the practice, said labour chief Lim Swee Say, because most companies have moved away from a seniority-based wage system where salaries are determined more by length of service rather than performance."

I am confused by this call as it was the government who made the laws with such a clause. A government to which Mr. Lim is a Minister in the PM Office (or a Minister without Portfolio). So,

I am not sure I understand his call here!

Lessons for me are:
1. from a pure economic standpoint, is keeping the older workers cost effective? If not, there is no way the employers should be asked NOT to cut or even fire the older workers!;

2. the leaders must stick to one view and hold it instead of wavering to and from like what is happening here. Worst, the left part of the mouth does not know what the right part of the mouth said!!;

3. what is the alternative IF the older workers are indeed competing with younger and cheaper FWs and FTs? Does the government still demand that the employers pay the older workers at the higher wages?

I think this is a losing battle. Naturally aging and deteriorate make the majority of the work force become less relevant and less productive!