SINGAPORE – Parliament has passed the Platform Workers Bill, a landmark legislation that places freelance delivery workers, private-hire drivers, and cab drivers under a distinct labour class equipped with statutory protections. This category sets them apart from regular employees and the self-employed.

The legislation takes into consideration the “precarious” nature of their work. “Hence, there is an urgent need to ensure protections for these groups of platform workers,” the Ministry of Manpower said.

Platform workers – also called gig workers – rely on online apps to make a living and are free from traditional work structures such as a rota or schedule.

Platform workers’ protections and benefits

The law, which will take effect on 1 January 2025, establishes the Central Provident Fund (CPF) contributions and insurance coverage of platform workers similar to the system used for traditional employees.

The changes provide platform workers with a social safety net – giving them a better chance of saving up for retirement, owning a property, claiming benefits in case of work-related injury, and seeking legal protections in case of a labour dispute.

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Platform workers can also seek representation from union-like organisations advocating for their interests, as in cases of collective bargaining or the resolution of work-related issues.

“The time has come for our platform workers to forge their own collective agreement so that their voices are heard, their working conditions improved, and their grievances addressed in a timely and fair manner,” said NTUC Assistant Secretary-General Yeo Wan Ling.

Meanwhile, platform operators – or those who regulate the apps where work is parsed out – will be required to pay higher CPF contributions on workers’ behalf, eventually matching the rates for regular employees. Operators will also cover the medical costs and lost income of injured workers, and compensate them with a one-off payment in case of death or permanent disability.

Union-like groups, known as platform work associations, will ensure the cost of these protections and benefits is not passed onto the workers.

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Covering the cost of worker protections and benefits

Who will cover the cost of higher CPF contributions and workers’ insurance?

These additional manpower costs, according to a senior government official, are “no different in nature” from what employers cover in the case of tenured workers. 

“It is a levelling up of what platform operators ought to have been paying, if they are to ensure basic protections for platform workers like what other employers have been doing for their employees all along,” said Dr Koh Poh Koon, Senior Minister of State for Manpower.

Dr Koh said traditional employers factor the costs into their overall operations while considering variables such as competition and profitability, among other market forces.

Some fear the manpower costs would translate to platform operators charging a higher price for their service.

But Dr Koh pointed out: “It would be disingenuous to reflect and charge these costs through a separate fee component.” 

With Singapore being a competitive market, operators who are planning to raise their prices because of the new legislation should “think carefully” before doing so since “such a move would be tantamount to passing the costs directly to customers,” Dr Koh said.

Despite questions on pricing and manpower costs, Prime Minister Lawrence Wong is confident the Platform Workers Bill offers a win-win solution for all stakeholders.

“Together, we have crafted a solution that benefits both workers and businesses, ensuring fair treatment while preserving the flexibility that gig work offers,” he said.