DETAILS on the raising of Central Provident Fund (CPF) contribution rates and liability for work-injury compensation under upcoming platform-worker protections were given in Parliament on Monday (Sep 9).
This was during the debate on the Platform Workers Bill, which implements these protections. The debate was adjourned and will continue on Tuesday.
If passed, it will give platform workers – which include ride-hailing and on-demand delivery workers – the same levels of work-injury compensation and CPF contribution rates as regular employees, with increments gradually stepped up from Jan 1, 2025.
Platform workers will also become a distinct class of workers, alongside employees and self-employed persons.
As at 2023, there were about 70,000 platform workers, making up 3 per cent of the workforce, said Senior Minister of State for Manpower Koh Poh Koon during the debate.
Other countries have adopted different approaches to improving platform workers’ labour standards, such as treating them as employees. Instead, Singapore’s approach provides legal clarity while preserving flexibility for both workers and operators, said Dr Koh.
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Giving platform workers the “full suite of employment rights”, such as sick pay and vacation leave, will change the relationship between operators and workers, which neither side wants, he added.
CPF contributions to go up
CPF contribution rates for workers and platform operators will be gradually raised over five years to match those of employees and employers.
Both sets of contributions will be computed based on net earnings from the platform each month, with an annual ceiling of S$102,000.
As previously announced, these increased CPF contributions will be mandatory for platform workers born on or after Jan 1, 1995. Older workers may opt in from November. Those who do not must continue making MediSave contributions and will not receive operators’ contributions.
From 2025, lower-income platform workers will also receive Workfare Income Supplement (WIS) payments monthly instead of annually. From 2029, those who make CPF contributions will also receive the same levels of WIS payments as employees, instead of the two-thirds received by self-employed persons.
Injury compensation
For work-injury compensation, platform workers will receive the same level of coverage as employees.
Compensation will be based on net earnings from all the platforms of one category – ride-hailing or food delivery – that a worker is on.
For workers doing both ride-hailing and delivery, compensation is calculated based on net earnings in the sector where they earned more in the past 90 days.
Compensation is capped at 90 calendar days from the accident. For workers whose earnings history is unavailable, the amount will be set at S$27 per day.
As for who is liable to pay compensation, Dr Koh laid out several scenarios.
If a worker is performing a pick-up or delivery for a single platform, that operator will be liable.
If a worker is performing jobs for different operators at the same time, liability will be confined to one operator, where possible, to simplify the claims process. This is subject to the following rules.
First, if the worker is doing pick-up and delivery for different operators, only the operator which the delivery is for will be liable. This is because the worker can reject jobs at the pick-up stage, but is committed to fulfilling deliveries as the passengers or goods are with them, said Dr Koh.
Second, if a worker is injured while doing only either pick-up or delivery, for multiple operators, then all will have to share the compensation, based on earnings from each operator over the past 90 days.
Workers who are injured while at work should inform the relevant platform operators as soon as possible. The operator will then file an injury report with the Ministry of Manpower (MOM), and the insurer will process the claim once it receives the report.
If multiple operators are liable, MOM will appoint a lead insurer to process the claim.
Streamlining processes
To streamline processes, a fixed proportion – based on mode of transport – will be deducted from platform workers’ gross earnings to account for expenses.
The resulting net earnings will be used to compute work-injury compensation and CPF contributions.
This will remove the administrative hassle for workers and operators to manually track and compute business expenses, said MOM.
Separately, companies will have to notify MOM from Jan 1 if they assess themselves to be platform operators. Their obligations begin upon meeting the definition of a platform operator, and not upon notification.
For a start, the law will cover ride-hail and delivery platforms, as 93 per cent of platform work is in these services, said Dr Koh.
Failing to notify MOM may result in a fine, though MOM did not disclose the amount. Operators would also have to pay any outstanding CPF contributions or work-injury compensation owed.
One measure that helps manage the impact on operators’ costs is that operators can pick insurers, with such competition facilitating sustainable premiums.
There are currently 26 such insurers, of which the government has worked with seven to develop policies for the new regime.
To address concerns about increased costs being passed on to workers, there are provisions to prohibit operators from recovering costs from workers, said Dr Koh.
