Companies Hiring Singaporeans Over 40 Can Get Up To $30,000 Subsidy Under New Incentive
As many Singaporeans have been hit by loss of income due to the Covid-19 pandemic, the Government is going all out to help secure our jobs with a range of schemes.
Among the 5th set of Budget measures this year revealed by Deputy Prime Minister Heng Swee Keat on 17 Aug was the Jobs Growth Incentive (JGI), to encourage companies to hire more local workers.
It means that a company that hires a worker older than 40 will get 50% of his salary paid by the Government for 12 months, up to a maximum of $30,000 — that’s $2,500 per month.
Promoting job creation for locals
The JGI is meant to encourage companies who can to hire more Singaporean workers, thereby creating jobs for locals.
That’s why it will subsidise the wages of new Singaporean hires of all ages, the Ministry of Manpower (MOM) said in a press release on Friday (4 Sep).
For mature workers, defined as aged 40 and above, the Government will pay half their salary for the 1st 12 months they’re working in the company — up to the 1st $5,000 of their monthly salary.
That means the Government will subsidise up to $2,500 a month of the salary of a mature worker hired, and up to $30,000 for 12 months.
Salary subsidy for younger workers too
Younger workers – i.e. those below 40 – are also covered under the JGI, as companies will get support for their salaries too, MOM said.
For every younger worker hired, the Goverment will pay 25% of their salary for 12 months, for the 1st $5,000 of their salary.
That’s up to $1,250 per month, or up to $15,000 for 12 months.
Even better, the JGI subsidies will be over and above the payouts under the Jobs Support Scheme, which covers the wages of current local employees.
That means companies can potentially enjoy support under both schemes at once.
Firms eligible for JGI must grow local workforce
However, companies have to meet certain criteria to enjoy JGI wage subsidy, MOM added.
They must firstly grow their local workforce over the next 6 months, from Sep 2020 to Feb 2021.
- The number of locals working there must have increased in this period, compared with the number of locals working there in Aug 2020.
2. Not only that, there must be an increase in local employees that receive at least $1,400 in gross monthly wages.
Secondly, the company must have been established on or before 16 Aug.
JGI payout drops if local staff leave company
Furthermore, if the company doesn’t meet these criteria for the full 12 months of the JGI, it won’t get the full amount of subsidy.
That means if any local employed by the company in Aug leaves after Aug, the JGI amount it gets will be less.
The amount that it will be reduced by will be 5% or more, depending on the proportion of the local staff who have left.
That means if 10% of a company’s local staff leave, the JGI payout will be reduced by 10%, even if more local staff are hired.
If 4% or less of a company’s local staff leave, the JGI will be 5%.
Companies will get JGI payouts from March 2021
The best part is, companies that meet the criteria do not need to apply for the JGI, according to the MOM.
They will get the the payouts automatically from March 2021, it said.
They don’t have to submit any statements either, as the payout will be calculated based on their Central Provident Fund (CPF) contributions.
Here’s the timetable for receiving the payouts, and the CPF contribution period that each payout is based on:
$1 billion devoted to JGI
The Government is devoting $1 billion to the JGI, for the express purpose of creating jobs for locals.
It’s hoped that the subsidies will encourage companies to hire more local staff if they can, as the pandemic has led to more job losses.
We thank the Government for the schemes, and hope they’ll be successful in helping more Singaporeans find jobs.
Featured image from MS News.