She was responding to parliamentary questions from NCMP Leong Mun Wai (PSP) and MP Muhamad Faisal Abdul Manap (WP-Aljunied) on the number of cases of firms underpaying its staff and the main methods of effecting such underpayments.
Last month, local cupcake chain Twelve Cupcakes was fined S$119,500 for underpaying seven employees of about S$114,000 between December 2016 and November 2018.
Between 2010 and 2014, an average of 60 employers every year were taken to task for underpaying their foreign employees’ salaries.
Mrs Teo said in her written answer that the increased number of cases between 2015 and 2019 was a result of “improved detection capabilities” and education efforts to encourage foreign employees to report salary irregularities.
“Most cases did not involve employment agencies. Nonetheless, over the same 10-year period, enforcement action was taken against six licensed employment agencies,” she said.
In some cases, underpayment was done by employers simply paying their foreign employees a lower salary.
“Some tried to avoid leaving any paper trail by crediting full declared salaries to the foreign employees and requiring the employees to return a portion back to them in the form of electronic transfers or in cash,” added Mrs Teo.
Under the Employment of Foreign Manpower Act, it is an offence if employers do not pay foreign employees their contractual fixed monthly salaries, or inflate foreign employees’ salaries with no intention of paying them the amount declared to the MOM.
“There is no excuse for underpayment of any employee, foreign or local. MOM will continue to take strong surveillance and enforcement action against errant employers and any other parties who abetted the offences,” said Mrs Teo.