daily gripe

Firms 'slow to adopt' variable part of pay reported in the Straits Times

May 18, 2006
Firms 'slow to adopt' variable part of pay
By Lynn Lee

COMPANIES are making their wages more flexible to ensure they can reward workers well in good times and stay afloat in bad times, but such reform is not happening fast enough.

Taking this view, the National Wages Council (NWC) singled out the monthly variable component (MVC) as one change that companies have been slow to implement.

The MVC is that part of a worker's salary which can be cut in severe downturns to help save jobs, and restored quickly when a company does well.

In a statement yesterday when it released its annual wage guidelines, the council noted 'with concern the slow progress' in introducing the MVC. It wants more firms to implement it and those that have done so, to quicken the pace to reach the national target of the MVC forming 10 per cent of a worker's pay.

Non-unionised companies have been especially slow, compared to unionised firms, in adopting wage reform, the NWC said.
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the rest of the article can be found in today's copy of the straits times or online.

what utter bullshit this whole MVC thing is man!! this just gives your company the opportunity to pay employees less and claim that they are working for the employees' benefit. let's be honest here - the ONE thing that all employees, regardless of earning capacity, current salary or potential growth, want is more cold hard cash. CPF we have to live with, bo bian, since that is a government-led effort. we are still pissed that they recommended cutting down their portion to 13% with no view in sight of that increasing although we get "reassurances" all the time.

so now the NWC or National Wage Council in case you didn't know, comes full out and highly recommends that we incorporate this MVC. the only people this will benefit is the SMEs that will become less worried to pump even more money into this economy. which by the way doesn't seem that robust. the economy needs money pumped in to make more money move around. does this benefit the employee slogging until 11pm at night, 5 nights a week, 20 nights a month? i honestly do not think so.

NWC! just recommend that employers raise the basic salary and let companies deal with wages internally. set the recommended minimum and let market dynamics do their job. why experiment with a society that is already rebelling against tighter restrictions and controls? stop contributing to the ideal of 1984...

analogy time - again from the same article.

One of them was a logistics company that began MVC cuts in late 2003, after continuous losses for over a year.

Management staff faced the deepest cuts which took effect earlier. Senior management took home 12.5 per cent less pay. Workers who earned $1,001 to $1,799 got a 2 per cent cut, but the wages of those who earned $1,000 or less were left intact. In July 2004, the company's business improved and all employees received a 3 per cent wage increase.

impressive. they got cut 12.5% and received a 3% increase. think it must be good to be a non-executive employee in that logistics company. of course, they will argue that 3% of a management person's pay is probably more that the 3% of the non-exec but this just proves that "what the hand giveth, the hand can also taketh".

use your bloody cow sense and recommend actions that allow employees to be rewarded amply for their contributions and not just focus on the 'bigger' picture. for every 1% that goes into that MVC, that is a figure operating from $12 and upwards (for a person earning $1200/month) being taken away from the employee that could go towards life, family or debt.

so what if the money does not get pumped back into the economy? can we depend on the cash poor to ride high in a booming economy? where will they have learnt the intricacies of threading through a power economy that requires more time and effort out of the working employee - while getting paid less? wherein lies the motivation?

posted by inspirethereal @ 11:44 PM