Tan Kin Lian's Blog: Minimum wage and cost of a maid

Monday, February 15, 2010

Minimum wage and cost of a maid

Some people argued for a minimum wage to be implemented in Singapore. REX argued against it, stating that the cost of a maid would increase to $1,500 a month, if a minimum wage is applied here.

I do not think that a minimum wage need to be as high as suggested by REX. It could be set at $1,000. If we consider the wages, government levy, food and lodging provided to a maid, most employers are already paying close to $1,000 a month.

If we pay a higher wage for a maid, we will get a better quality maid, which may be better in the long run. There is also a high cost in replacing a maid. Under the current system, many employers have to replace the maid quite often and suffer this additional cost.

We should not allow the higher cost of employing a maid affect our thinking towards paying a decent wage to other workers in Singapore who need to earn enough to pay for the high cost of living in Singapore.

13 comments:

Anonymous said...: REX comments as follows,

Hi Kin Lian, thanks for highlighting this matter.
Just to clarify myself, i am not "against" minimum wage. I was just saying that I am caught in a selfish struggle between myself wanting to pay the maid just $400 a month vs. declaring min. wage policy in which case i have to pay the maid maybe $1500. Also, the figure of $1500 was based on another reader who suggesed the figure of $7.50 per hour on nationwide basis presumably for all employement genres.

Secondly, as you reckoned, most households are already paying close to $1000 per month.. in that case the argument is still same, by declaring a min. wage, this will drive the "effective" min. wage to $2000 by your reckoning.

The point i make is that a maid is NOT a luxury expense, many families e.g retirees, family with young children, etc, just simply cannot continue without maid.

So it's a case of selfish needs vs. noble needs. Theoretically you are correct of course, we should not allow the higher cost of employing maids affect our national ideals, but i admit that i am selfish in the sense as illustrated. Of course for families who don't need maids at all, this is non issue, they can champion worker's rights for higher wages. Life is complicated.

REX; February 15, 2010 10:25 AM
Singapore Short Stories said...: Agree with you Mr Tan. Happy Chinese New Year to You!; February 15, 2010 10:25 AM
Norman said...: The question I have in my mind is, how did the older generation manage their families without a maid?

If they could do so, why do most people need a live-in maid today?; February 15, 2010 10:43 AM
hongjun said...: Then where will the maid stay if $1,000 is imposed? Still in the boss' house? Who will pay transport for the maid if she is to run errands?

Then wouldn't it be more than 1K?

There are many issues to be trashed.; February 15, 2010 11:19 AM
Tan Kin Lian said...: If a minimum wage applies to foreign maids, it should be possible for the employer to count the cost of lodging and food as part of the minimum wage, so the net pay to the maid should be lower.

If the government wish to impose a levy on foreign workers, this should come out of the minimum wage, and not be an additional cost to the employer.

I believe that some fair arrangement can be worked out for foreign maids, recognizing their special situation.; February 15, 2010 11:23 AM
hongjun said...: First, I would like to say I am not against minimum wage.

The difficult question comes when we decide the net pay for a maid. Either the net pay is set by the employer or the government. If it is set by the employer, then there must be a guideline to calculate that. And if it is set by the government, then the employer must make sure quality of lodging and food, medical benefits, etc must be reasonable and not overly low as set by the government. That's happening now I suppose.

That's going to be difficult and hard to police.; February 15, 2010 11:35 AM
Anonymous said...: REX comments on "norman"'s post.,

Well, in the past people don't need maids as much as today, because,

i. It was easily possible to survive on the salary of just the man, the woman can look after the kids, and elderly parents and keep house. Rent was cheap, housing was TRULY subsidised by State, food was cheap, it was easy to be contented. Nowadays both parents have to work to pay the 30 year loan of the "affordable" house, so a maid is often a necessity not luxury esp if the kids are very young.

ii. The cluster-family concept 三代同堂was more respected and in-laws helping out in looking after children was more prevalent.

iii. People were generally younger and fitter we didnt have an aged society like today, so it was easier to have parents taking care of grandchildren.

REX; February 15, 2010 11:56 AM
Laremy said...: Hi Kin Lian,

How about using the term 'foreign domestic helper' (FDH) in the future?

It is an accepted term in global parlance but Singaporeans haven't caught on to it yet because media outlets - mainstream or otherwise - are still using the old term i.e. 'maid'.

Many people (including myself) frown upon the use of the word 'maid' as it has derogatory connotations.

Thanks,
Laremy; February 15, 2010 1:11 PM
Anonymous said...: I agree that we should have a minimum wage in Singapore. A lot of lower income people will benefit from it. It's true that maid(FDH) wage will increase. But how do other western countries do without maid?
I live in Western Europe where maid is unheard of. Too expensive. A day-time nanny will cost 1500€ due to min wage. Husband and I both work and we put our kid in the child care center. We both do housework togather and take care of our kid togather. It demands a lot of family commitment but it is possible to live without a maid. Go get a dish washer, clothes dryer. They help.; February 15, 2010 4:02 PM
Anonymous said...: How does Western Europe manage without maids?

I suspect it's because they have work-life balance, better social services, better employee protection etc.

The Singapore family is subsidizing the Singapore state by;
- looking after aging parents,
- working overtime without pay,
- hiring private tutors to make up for teaching deficiencies in the schools

I'll leave you guys to think of other instances; February 15, 2010 5:55 PM
Anonymous said...: After working in a Australia company, I realised the cleaner in Australia gets a pay of almost S$3000 in Australia. Minimum wage of S$1500 is reasonable. Without minimum wage, lower income Singaporeans are exploited due to influx of cheap foreign labour.; February 16, 2010 2:22 AM
Anonymous said...: REX comments again

After thinking through this matter again and especially reflecting on Kin Lian's main article of this thread, i have an idea that will really solve the dilemma which i raised.

Solution is as follows:
Minium wage policy of, say $1200 should be applied only if board and lodging not provided. So since a maid is provided with board and lodging, deduct $500. Next, Abolish the foreign maid levy $200 imposed by the government (that is outrageous in the first place). So total to pay the maid is a minimum of $500. This will be a good compromise to resolve the dilemma which i mentioned before. Yes, i think minimum wage policy is good, i can't see any bad things about it . What is bad is simply that the government simply don't want to open debate on this issue. When we open debate we have fresh ideas and brainstorming can lead to positive win win solutions.

REX; February 16, 2010 9:21 AM
Anonymous said...: Well, if maids (FDH) are really needed, can have tax rebates for certain scenarios. This tax rebate can bring down the employers payment to around $500 / month.

Scenarios can be:
(1) Kids from 0-6 yrs old.
(2) Parents >= 65 yrs old.
(3) Handicapped, sick etc family member.

For other normal situation, minimum salary of say $1300 / month will apply, as can be considered a luxury. I.e. richer families can pay more for domestic help if they want, just like more expensive hospitals, specialists and medical insurance.

I think we should always think-out-of-the-box and/or brainstorm to improve things, otherwise we will all just be accepting the status quo, and depending on govt to dictate how life should be.

Just like some employers, always complain to govt and MOM -- want higher FW ratio, want lower FW levy, want faster work permit and employment pass processing, want faster PR processing etc. They just want to maintain status quo or increase the staus quo, because this is good & easy for them.

You need to think & ask yourself if status quo is good for you and your family? Minimum wage for maids (FDH) is just a tiny part of the overall puzzle.; February 16, 2010 3:51 PM