28 Nov 2012

Analysis of Singapore bus strike

From Reuters
This week's walkout in Singapore by dozens of mainland Chinese bus drivers over disparities in pay would have been considered small, calm and short-lived in almost any other nation. But the strike, in breach of the law and mostly over by Wednesday, was the first significant industrial action in the tightly regulated Asian financial centre in more than 25 years.
For the first two days of this week, buses ran late and crowded in a city that prides itself on efficiency, leading to complaints from customers. After a tough election last year, the strike highlights challenges for the long-ruling government of the majority ethnic Chinese island as it tries to defuse anger over an influx of immigrants while discouraging labour unrest that could hurt investment.

Migrant workers strike back
The action by the drivers from China, over complaints they are paid less than Singaporean and Malaysian peers, also underlines the treatment of lower-skilled foreign workers who are vital to the construction, hospitality and transport sectors in the wealthy city-state.
"There's a danger in becoming too emotional about it," said Bank of America Merrill Lynch economist Chua Hak Bin. "Not many Singaporeans want to work as bus drivers at this kind of wage levels. You need foreign workers to fill the gap." Chua said companies would have to get used to higher wage demands by lower-skilled foreign workers, given the much larger salary increases in countries such as China.
In the case of SMRT Corp Ltd, one of two bus companies that operate in Singapore, Chinese nationals account for about 450 of the 2,000 or so drivers on its payroll. Kit Wei Zheng, an economist at Citigroup, said more labour disputes could emerge given developments in the region. "Globally and regionally, there is greater labour activism taking place," he said. "In China, you have seen more assertive industrial action so, in hindsight, it was not surprising that some of these pressures reached Singapore's shores."

An island of millionaires
As a global financial centre with the world's highest concentration of millionaires, Singapore is awash with flashy cars, pricey shops and fancy restaurants that epitomise the wealth of foreign and domestic businesspeople and bankers. But much of the vitriol against immigrants - about stealing jobs, pushing up housing costs and crowding public transport - is directed at the most visible, those who do the tough and dirty work and are among the lowest paid.
Singapore, which saw its last major industrial action in 1986 at an American oilfield equipment firm, has no minimum wage and prohibits workers in public transport and other essential services from going on strike without giving notice of 14 days. In taking action that Tan, the acting manpower minister, said "clearly crossed the line", 171 Chinese drivers did not show up for work on Monday and 88 did not report on Tuesday.

Chinese embassy intervenes to end strike
Most of them returned to duty on Wednesday after officials from the Chinese embassy spoke with them late on Tuesday. Tan said his ministry expected SMRT, controlled by powerful state investor Temasek Holdings Pte Ltd, to address the grievances but that the government had "zero tolerance for such unlawful action".
The National Trades Union Congress, which does not represent the Chinese drivers, said "any action that is illegal must and will be dealt with firmly, regardless of whether the workers are local or foreign".

An attack on pay
The drivers complain SMRT switched them to a six-day week with slightly higher pay from a five-day week that had allowed them to earn more by doing overtime. One driver told the Lianhe Wanbao newspaper he now was paid S$1,400 a month, lower than the S$2,000 he used to be able to make with overtime on days off. The Chinese are also angry about getting less than Singaporean and Malaysian drivers.
Bus drivers, whether Chinese or Singaporean, are not highly paid in a country where the 2011 median monthly salary was about S$3,250 for citizens and permanent residents. Foreign maids and nannies - most of them from Indonesia, the Philippines and Myanmar - do even worse, getting as little as S$500 a month.

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