Solidarity Budget Will Cover 75% Of Employee Wages So They Don’t Resort To Unpaid Leave Or Pay Cuts

Deputy Prime Minister (DPM) Heng Swee Keat announced today (6 Apr) during the Solidarity Budget that the Government will subsidise 75% of wages for employers to pay employees.

This amount will apply to the first $4,600 of wages paid in Apr 2020 per employee, which will help roughly 1.9 million employees in Singapore.

Those who earn more each month can still get wage support, though it is only covers the first $4,600 of their income.

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The measure is an upgrade to the Jobs Support Scheme (JSS), which was previously set to begin in May.

The JSS in the earlier Resilience Budget only offered a 25% subsidy in wage support.

Solidarity Budget subsidy will apply to up to $4,600 of wages

The wage support from the government will help firms to pay 75% of what’ll go to gross employee salaries in Apr this year.

This amount will be before CPF contributions.

For example, 75% of $4,600 is $3,450 — which is the median wage level of a full-time employee in Singapore.

The aim is to ensure that employers can keep paying employees from Apr onwards instead of May as first intended.

Employers may not have to turn to unpaid leave or pay cuts

There are fears amid the Covid-19 crisis that struggling companies may not be able to pay their employees during this time.

As such, the government is stepping in further with this third Solidarity Budget so that they can continue to pay employees.

This measure will hopefully prevent firms from having to enforce unpaid leave or pay cuts during this time.

Featured image adapted from Treksplorer.