Labour Clauses (Public Contracts) Convention, 1949 (No. 94) - Singapore (RATIFICATION: 1965)

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Article 2 of the Convention. Insertion of labour clauses in public contracts. The Committee previously requested the Government to take all appropriate measures to ensure that all public contracts falling within the scope of the Convention are awarded only to enterprises (including any subcontractors) which guarantee to their workers’ wages, hours of work and other conditions of labour not less favourable than those set out in existing collective agreements or generally observed in the same sector or industry by employers in a similar situation. The Committee recalled that, as clarified in paragraph 112 of its 2008 General Survey on labour clauses in public contracts, in those countries where the employment conditions which are laid down in the national legislation constitute both maximum and minimum standards, which may not be exceeded by more favourable collective agreements or arbitration awards, a reference in the public contracts to the relevant provisions of the national legislation would be sufficient for the purpose of giving effect to the Convention. The Committee noted that, therefore, in situations where no arrangements exist for the effective regulation of wages and other employment conditions through collective bargaining, the Convention may not be deemed to require contractors to do more than to merely conform to the national labour legislation. The Committee also requested the Government to transmit copies of the legal text(s) regulating the accreditation and grading systems of cleaning and security services. The Government reports that, in the absence of industry-level collective agreements, contractors and vendors are required to provide their workers with adequate standards equivalent to those established by national laws. It adds that companies engaged under public contracts are required to ensure wages, hours of work, and other conditions of labour that are not less favourable than those established for work of the same character in the trade or industry. The Committee notes with interest the information provided by the Government on additional measures taken (with effect from 31 January 2019) to safeguard the basic employment rights of outsourced workers in the cleaning, security and landscape sectors. It further notes that, as part of the applicable licensing/registration requirements, cleaning, security, and landscape companies must demonstrate that they have a progressive wage structure in place such that the employees concerned receive wages that are commensurate with the higher training, standards and productivity required of them. In addition, to meet licensing and registration requirements, companies must ensure that they have not breached employment laws or defaulted on Employment Claims Tribunal Orders for a specified period of time. The Committee welcomes the copies of the specific instruments regulating the accreditation and grading systems for cleaning and security services communicated by the Government. The Committee welcomes the information provided by the Government and requests that it continue to provide information on the general manner in which the Convention is applied, including, for instance, labour inspection reports, indicating the number of inspections of public administration contracts carried out, the number and type of violations detected and the sanctions imposed, if any. Please also provide information on any practical difficulties encountered in the application of the Convention.

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The Committee notes that the Government’s report has not been received. It hopes that the next report will contain full information on the matters raised in its previous comments initially made in 2013.

Repetition

Article 2 of the Convention. Insertion of labour clauses in public contracts. The Committee notes the Government’s explanations that, in the absence of industry-level collective agreements in the national context, the Convention is understood as requiring contractors engaged in the execution of public contracts to provide their workers with wages and other conditions of labour not less favourable than those established by law. In this regard, the Government conducts audits on employers to ensure that they provide conditions of work which are not less favourable than those stipulated under the Employment Act, and it reserves the right to terminate the contract in situations where the standards specified in the law are not met.

The Government further explains that, in demonstration of its commitment not only to outsource responsibly but also to adopt best practices in doing so, all public contracts for cleaning and security services are awarded only to cleaning companies with at least a “Clean Mark Silver Award” under the National Environment Agency’s enhanced accreditation scheme and to security agencies that are graded “A” or “B” by the Security Industry Regulatory Department. These accreditation and grading schemes recognize companies that deliver high standards of service, such as through training of workers or exercise of good employment practices. The Government adds that it has reviewed and enhanced the criteria for cleaning services accreditation by introducing, among other criteria, a requirement that cleaners employed in accredited companies receive wages that are not less favourable than existing collective agreements, or in the absence of collective agreements, prevailing market rates. Accredited cleaning companies are also required to ensure that they do not default on any labour court orders which may have been issued in the preceding 12 months of accreditation. The Government further indicates that it is also reviewing the employment-related criteria in the security services grading scheme.

With respect to the points raised in the Government’s report, the Committee wishes to recall, first, that as it has clarified in paragraph 112 of its 2008 General Survey on labour clauses in public contracts, in those countries where the employment conditions which are laid down in the national legislation constitute both maximum and minimum standards, which may not be exceeded by more favourable collective agreements or arbitration awards, a reference in the public contracts to the relevant provisions of the national legislation would be sufficient for the purpose of giving effect to the Convention. In situations, therefore, where no arrangements exist for the effective regulation of wages and other employment conditions through collective bargaining, the Convention may not be deemed to require contractors to do more than to merely conform to the national labour legislation.

However, the Committee notes that under the revised accreditation scheme for cleaning services, cleaning companies may not aspire to obtain contracts with the Government unless they can show that the wage levels for cleaners are aligned with those in existing collective agreements. The Committee considers that this new accreditation prerequisite essentially reflects the requirement set out in Article 2 of the Convention (at least as far as wage rates are concerned), and hopes that similar conditions will be applied to all other public procurement operations whether for works, goods or services. The Committee accordingly requests the Government to take all appropriate measures to ensure that, either through a system of accreditation such as that used for cleaning companies or other method of screening tenderers, all public contracts falling within the scope of the Convention are awarded only to enterprises (including any subcontractors) which guarantee to their workers wages, hours of work and other conditions of labour (for example, holiday and sick leave entitlements) not less favourable than those set out in existing collective agreements or generally observed in the same sector or industry by employers in a similar situation. The Committee also requests the Government to transmit copies of the legal text(s) regulating the accreditation and grading systems of cleaning and security services.

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The Committee notes that the Government’s report has not been received. It hopes that the next report will contain full information on the matters raised in its previous comments initially made in 2013. The Committee also notes that the Government has been requested to provide information to the Committee on the Application of Standards at the 106th Session of the International Labour Conference for failure to supply reports and information on the application of ratified Conventions.

Repetition

Article 2 of the Convention. Insertion of labour clauses in public contracts. The Committee notes the Government’s explanations that, in the absence of industry-level collective agreements in the national context, the Convention is understood as requiring contractors engaged in the execution of public contracts to provide their workers with wages and other conditions of labour not less favourable than those established by law. In this regard, the Government conducts audits on employers to ensure that they provide conditions of work which are not less favourable than those stipulated under the Employment Act, and it reserves the right to terminate the contract in situations where the standards specified in the law are not met.

The Government further explains that, in demonstration of its commitment not only to outsource responsibly but also to adopt best practices in doing so, all public contracts for cleaning and security services are awarded only to cleaning companies with at least a “Clean Mark Silver Award” under the National Environment Agency’s enhanced accreditation scheme and to security agencies that are graded “A” or “B” by the Security Industry Regulatory Department. These accreditation and grading schemes recognize companies that deliver high standards of service, such as through training of workers or exercise of good employment practices. The Government adds that it has reviewed and enhanced the criteria for cleaning services accreditation by introducing, among other criteria, a requirement that cleaners employed in accredited companies receive wages that are not less favourable than existing collective agreements, or in the absence of collective agreements, prevailing market rates. Accredited cleaning companies are also required to ensure that they do not default on any labour court orders which may have been issued in the preceding 12 months of accreditation. The Government further indicates that it is also reviewing the employment-related criteria in the security services grading scheme.

With respect to the points raised in the Government’s report, the Committee wishes to recall, first, that as it has clarified in paragraph 112 of its 2008 General Survey on labour clauses in public contracts, in those countries where the employment conditions which are laid down in the national legislation constitute both maximum and minimum standards, which may not be exceeded by more favourable collective agreements or arbitration awards, a reference in the public contracts to the relevant provisions of the national legislation would be sufficient for the purpose of giving effect to the Convention. In situations, therefore, where no arrangements exist for the effective regulation of wages and other employment conditions through collective bargaining, the Convention may not be deemed to require contractors to do more than to merely conform to the national labour legislation.

However, the Committee notes that under the revised accreditation scheme for cleaning services, cleaning companies may not aspire to obtain contracts with the Government unless they can show that the wage levels for cleaners are aligned with those in existing collective agreements. The Committee considers that this new accreditation prerequisite essentially reflects the requirement set out in Article 2 of the Convention (at least as far as wage rates are concerned), and hopes that similar conditions will be applied to all other public procurement operations whether for works, goods or services. The Committee accordingly requests the Government to take all appropriate measures to ensure that, either through a system of accreditation such as that used for cleaning companies or other method of screening tenderers, all public contracts falling within the scope of the Convention are awarded only to enterprises (including any subcontractors) which guarantee to their workers wages, hours of work and other conditions of labour (for example, holiday and sick leave entitlements) not less favourable than those set out in existing collective agreements or generally observed in the same sector or industry by employers in a similar situation. The Committee also requests the Government to transmit copies of the legal text(s) regulating the accreditation and grading systems of cleaning and security services.

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Article 2 of the Convention. Insertion of labour clauses in public contracts. Further to previous observation, the Committee notes the Government’s explanations that, in the absence of industry-level collective agreements in the national context, the Convention is understood as requiring contractors engaged in the execution of public contracts to provide their workers with wages and other conditions of labour not less favourable than those established by law. In this regard, the Government conducts audits on employers to ensure that they provide conditions of work which are not less favourable than those stipulated under the Employment Act, and it reserves the right to terminate the contract in situations where the standards specified in the law are not met.

The Government further explains that, in demonstration of its commitment not only to outsource responsibly but also to adopt best practices in doing so, all public contracts for cleaning and security services are awarded only to cleaning companies with at least a “Clean Mark Silver Award” under the National Environment Agency’s enhanced accreditation scheme and to security agencies that are graded “A” or “B” by the Security Industry Regulatory Department. These accreditation and grading schemes recognize companies that deliver high standards of service, such as through training of workers or exercise of good employment practices. The Government adds that it has reviewed and enhanced the criteria for cleaning services accreditation by introducing, among other criteria, a requirement that cleaners employed in accredited companies receive wages that are not less favourable than existing collective agreements, or in the absence of collective agreements, prevailing market rates. Accredited cleaning companies are also required to ensure that they do not default on any labour court orders which may have been issued in the preceding 12 months of accreditation. The Government further indicates that it is also reviewing the employment-related criteria in the security services grading scheme.

With respect to the points raised in the Government’s report, the Committee wishes to recall, first, that as it has clarified in paragraph 112 of its 2008 General Survey on labour clauses in public contracts, in those countries where the employment conditions which are laid down in the national legislation constitute both maximum and minimum standards, which may not be exceeded by more favourable collective agreements or arbitration awards, a reference in the public contracts to the relevant provisions of the national legislation would be sufficient for the purpose of giving effect to the Convention. In situations, therefore, where no arrangements exist for the effective regulation of wages and other employment conditions through collective bargaining, the Convention may not be deemed to require contractors to do more than to merely conform to the national labour legislation.

However, the Committee notes that under the revised accreditation scheme for cleaning services, cleaning companies may not aspire to obtain contracts with the Government unless they can show that the wage levels for cleaners are aligned with those in existing collective agreements. The Committee considers that this new accreditation prerequisite essentially reflects the requirement set out in Article 2 of the Convention (at least as far as wage rates are concerned), and hopes that similar conditions will be applied to all other public procurement operations whether for works, goods or services. The Committee accordingly requests the Government to take all appropriate measures to ensure that, either through a system of accreditation such as that used for cleaning companies or other method of screening tenderers, all public contracts falling within the scope of the Convention are awarded only to enterprises (including any subcontractors) which guarantee to their workers wages, hours of work and other conditions of labour (for example, holiday and sick leave entitlements) not less favourable than those set out in existing collective agreements or generally observed in the same sector or industry by employers in a similar situation. The Committee also requests the Government to transmit copies of the legal text(s) regulating the accreditation and grading systems of cleaning and security services.

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Article 2 of the Convention. Insertion of labour clauses in public contracts. The Committee recalls its previous comment in which it noted the Government’s persistent failure to give effect to the provisions of the Convention in both law and practice, and requested the Government to take the necessary steps without further delay in order to effectively implement the provisions of the Convention. The Committee notes the Government’s reply that public contracts are awarded on the basis of “value for money” which refers not only to price but also to the quality and reliability of goods and services provided. Tenderers are also assessed in totality, taking into consideration their financial position, track records, including employment terms and conditions of their workers ensuring that workers’ well being is not undermined. The Government indicates, in this connection, that contractors engaged by the Singapore Ministry of Manpower are required to be part of the bizSAFE programme, which assists companies to manage workplace safety and health. The Government also indicates that it is exploring a debarment framework whereby egregious employers would be barred from tendering for public contracts.

While noting the Government’s explanations, the Committee considers, as it has pointed out in paragraph 308 of its 2008 General Survey on labour clauses in public contracts, that the objectives of the Convention are even more valid today that they were 60 years ago and strengthen the ILO’s call for fair globalization. The Convention seeks to promote good governance and socially responsible public procurement by requiring bidders/contractors to apply locally established prevailing pay and other working conditions as determined by law or collective agreement. The Convention proposes a common level playing field – in terms of labour standards – for all economic actors so as to ensure fair competition. By requiring all bidders to respect, as a minimum, certain locally established standards, wages, working time and working conditions may not be used as elements of competition and consequently no downward pressure on wages and working conditions may be exerted.

As for the possibility of screening tenderers through a debarment mechanism, the Committee wishes to refer to paragraphs 117–118 of the abovementioned General Survey in which it pointed out that the Convention does not relate to some general eligibility criteria of individuals or enterprises bidding for public contracts but requires a labour clause to be expressly included in the actual contract that is finally signed by the procuring entity and the selected contractor. Similarly, certification may offer some proof about tenderers' past performance and law-abiding conduct but carries no binding commitment with regard to prospective operations as labour clauses do. Noting therefore that national legislation appears to contain no provision implementing the requirements of this Article of the Convention (the Executive Resolution of 1952, which previously gave effect to the Convention, having probably fallen into desuetude), the Committee once more expresses the hope that the Government will take all necessary measures to put its legislation in line with the provisions of the Convention and asks it to keep the Office informed of any progress made in this regard.

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The Committee notes that the Government’s report has not been received. It must therefore repeat its previous observation which read as follows:

Article 2 of the Convention. Insertion of labour clauses in public contracts. The Committee has been commenting on the Government’s persistent failure to give effect to the provisions of the Convention in either law or practice. The Committee has also been requesting clarification as to whether the Executive Resolution of 10 June 1952 providing for the inclusion of fair wages clauses in government contracts, which previously gave effect to the provisions of the Convention, is still in force. In its last report, the Government indicates that it is currently reviewing the requirements of the Convention and that the Committee’s concerns are duly noted. In addition, the Government refers to the “Tripartite Advisory on Responsible Outsourcing Practices” which was adopted in 2008 by the tripartite committee on work-related benefits for low-wage workers and which seeks to ensure compliance with national employment laws by end-user companies when they outsource their business functions and buy services from third-party contractors. The Committee is bound to observe, in this connection, that this initiative bears little relevance to the Convention as it does not refer to public procurement contracts awarded through competitive bidding.

To help better understand the requirements of the Convention, the Committee wishes to refer to paragraphs 40 and 41 of its General Survey of 2008 on labour clauses in public contracts in which it explained that the essential purpose of the Convention is to ensure that the workers employed by a contractor and paid indirectly out of public funds enjoy wages and conditions of labour which are at least as satisfactory as those normally established for the type of work concerned, whether they are established by collective agreement or otherwise, in the locality where the work is done. The Convention requires that this be done through the insertion of appropriate labour clauses in public contracts. The intention is that labour costs are removed from competition between bidders and also that local standards higher than those of general application should be applied, where they exist. Accordingly, clauses within public contracts that merely restate the applicability and binding nature of national employment or labour laws – such as for instance the clause included in the Public Sector Standard Conditions of Contract (PSSCOC) formulated by the Building and Construction Authority – are not sufficient to meet the requirements of the Convention.

Along the same line of thought, in paragraphs 44 and 103 of the General Survey, the Committee observed that conditions not less favourable than the three alternatives offered by the Convention (i.e. collective agreement, arbitration award or national laws or regulations) in practice, in most instances, imply the best conditions of the three. In fact, the type of labour clauses prescribed by Article 2 of the Convention seek to ensure that the contractor applies the most advantageous pay rates, including overtime pay, and other working conditions, such as limits on hours of work and paid leave entitlement, established in the industrial sector and geographical region in question. The concrete terms of this obligation incumbent on the selected bidder and any subcontractors, are to be reflected in a standard contractual clause which has to be effectively enforced notably through a system of specific sanctions. In light of the preceding observations, the Committee hopes that the Government will take the necessary steps without further delay in order to effectively implement the Convention and asks it to keep the Office informed of any progress made in this regard.

The Committee hopes that the Government will make every effort to take the necessary action in the near future.

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Article 2 of the Convention. Insertion of labour clauses in public contracts. The Committee has been commenting on the Government’s persistent failure to give effect to the provisions of the Convention in either law or practice. The Committee has also been requesting clarification as to whether the Executive Resolution of 10 June 1952 providing for the inclusion of fair wages clauses in government contracts, which previously gave effect to the provisions of the Convention, is still in force. In its last report, the Government indicates that it is currently reviewing the requirements of the Convention and that the Committee’s concerns are duly noted. In addition, the Government refers to the “Tripartite Advisory on Responsible Outsourcing Practices” which was adopted in 2008 by the tripartite committee on work-related benefits for low-wage workers and which seeks to ensure compliance with national employment laws by end-user companies when they outsource their business functions and buy services from third-party contractors. The Committee is bound to observe, in this connection, that this initiative bears little relevance to the Convention as it does not refer to public procurement contracts awarded through competitive bidding.

To help better understand the requirements of the Convention, the Committee wishes to refer to paragraphs 40 and 41 of its General Survey of 2008 on labour clauses in public contracts in which it explained that the essential purpose of the Convention is to ensure that the workers employed by a contractor and paid indirectly out of public funds enjoy wages and conditions of labour which are at least as satisfactory as those normally established for the type of work concerned, whether they are established by collective agreement or otherwise, in the locality where the work is done. The Convention requires that this be done through the insertion of appropriate labour clauses in public contracts. The intention is that labour costs are removed from competition between bidders and also that local standards higher than those of general application should be applied, where they exist. Accordingly, clauses within public contracts that merely restate the applicability and binding nature of national employment or labour laws – such as for instance the clause included in the Public Sector Standard Conditions of Contract (PSSCOC) formulated by the Building and Construction Authority – are not sufficient to meet the requirements of the Convention.

Along the same line of thought, in paragraphs 44 and 103 of the General Survey, the Committee observed that conditions not less favourable than the three alternatives offered by the Convention (i.e. collective agreement, arbitration award or national laws or regulations) in practice, in most instances, imply the best conditions of the three. In fact, the type of labour clauses prescribed by Article 2 of the Convention seek to ensure that the contractor applies the most advantageous pay rates, including overtime pay, and other working conditions, such as work hour limits and holiday entitlement, established in the industrial sector and geographical region in question. The concrete terms of this obligation incumbent on the selected bidder and any subcontractors, are to be reflected in a standard contractual clause which has to be effectively enforced notably through a system of specific sanctions. In light of the preceding observations, the Committee hopes that the Government will take the necessary steps without further delay in order to effectively implement the Convention and asks it to keep the Office informed of any progress made in this regard.

Finally, with a view to assisting the Government in its efforts to give effect to the Convention, the Committee attaches herewith a copy of the Practical Guide on the Convention prepared by the Office in September 2008 and based principally on the findings of the abovementioned General Survey. It also recalls that the Government may draw upon the advisory services of the Office if it so wishes.

[The Government is asked to reply in detail to the present comments in 2010.]

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The Committee notes the Government’s reference to the Government Procurement Act (Chapter 120) of 1997, as amended in 2004, and the Building and Construction Industry Security of Payment Act of 2004 (Chapter 30B), as amended in 2006. It also notes the various Public Sector Standard Conditions of Contract (PSSCOC) and their supplements formulated by the Building and Construction Authority, such as the PSSCOC for construction works, design and build, and nominated subcontract. It further notes the Government’s statement that all PSSCOC include a common provision specifying that public contracts are subject to national law and that, under this clause, the provisions of the Employment Act, Industrial Relations Act, Workmen Compensation Act and the Central Provident Fund Act, which prescribe statutory minimum benefits (including normal and overtime rate of wages and hours of work), apply to employees engaged in the execution of such public contracts. The Government also indicates that some public contracts include a specific labour clause providing, for example, that the contractor must pay his/her workers promptly and observe the workers’ working hours and holidays in accordance with current laws and regulations.

The Committee is bound to recall, in this respect, that the mere fact that the labour legislation is applicable to workers engaged in the context of public contracts does not in any way exempt the Government from providing for the inclusion in public contracts of the labour clauses envisaged in the Convention. Such inclusion ensures the protection of workers in cases in which the legislation only establishes minimum conditions of work (e.g. minimum pay rates) which may be exceeded by general or sectoral collective agreements. Moreover, even if collective agreements were applicable to workers engaged in the context of the execution of public contracts, the implementation of the Convention retains its full value in so far as its provisions are designed precisely to ensure the specific protection needed by those workers. For example, the Convention requires the adoption by the competent authorities of measures, such as the advertisement of specifications, to ensure that tenderers have advance knowledge of the terms of the labour clauses. It also requires notices to be posted in conspicuous places at the workplace to inform workers of the conditions of work applicable to them. Finally, it provides for sanctions in the event of non-compliance with the terms of labour clauses, such as the withholding of contracts or the withholding of payments due to contractors, which may be more directly effective than those available for violations of the general labour legislation. The Committee therefore requests the Government to take all necessary measures to ensure the insertion of labour clauses in public contracts as required under Article 2 of the Convention. It also requests the Government to specify whether the Executive Council Resolution of 10 June 1952 providing for the inclusion of fair wages clauses in government contracts, which previously gave effect to the provisions of the Convention, is still in force. In addition, the Committee asks the Government to transmit a copy of the Government Procurement Regulations and Government Procurement (Application) Order, and also to specify whether standard conditions of contract exist for the procurement of supplies and services. Furthermore, the Committee asks the Government to indicate how it is ensured in law and practice the application of Article 2, paragraph 3 (consultations for determining the terms of labour clauses); Article 2, paragraph 4 (advertising labour clauses through specifications); Article 4(a)(iii) (informing workers of their conditions of work through posting of notices); and Article 5 (withholding of contracts and withholding of payments), of the Convention.

Finally, the Committee seizes this opportunity to refer to this year’s General Survey which contains an overview of public procurement practices and procedures in so far as labour conditions are concerned and makes a global assessment of the impact and present-day relevance of Convention No. 94.

[The Government is asked to reply in detail to the present comments in 2008.]

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Part V of the report form. The Committee notes that for many years the Government has been indicating that there are no major developments to be reported and consequently has not provided any information on the practical application of the Convention. In this connection, the Committee recalls that under Part V of the report form governments are requested to give a general appreciation of the manner in which the Convention is applied, including, for instance, extracts from official reports, information concerning the number of contracts and workers covered by relevant legislation, etc. This form, which was adopted by the Governing Body of the ILO, is the main channel through which the Committee may obtain all the necessary information in order to follow the evolution of national laws and practice in matters covered by the Convention. The Committee would therefore be grateful if the Government would provide in its next report detailed and up-to-date information on the practical application of the Convention, including copies of public contracts, the model text of the labour clause currently in use, information from inspection services on the supervision and enforcement of national legislation and any other particulars bearing on the application of the Convention.