Starting 1 January 2025, cab drivers, private-hire drivers, and freelance delivery workers who depend on online matching platforms for their income will receive enhanced labour protections, following the passage of a landmark Bill in Singapore’s Parliament on September 10. These workers, known as platform workers, will be classified in a new legal category between employees and the self-employed.
The 70,500 platform workers will benefit from higher contributions to the Central Provident Fund (CPF), matching the rates paid by employees and employers today. Platform operators will also be required to provide standardised work injury compensation insurance, offering the same level of coverage as that available to employees.
Moreover, platform workers, who are currently unable to form unions, will be allowed to establish platform work associations with legal powers comparable to trade unions. These associations will enable them to negotiate legally binding collective agreements with platform operators and access various forms of redress, including the right to strike if deemed necessary and justified.
The Bill, the result of a three-year process that started in 2021, received cross-party support in Parliament. During two days of debate, 26 Members of Parliament backed the legislation, though some raised concerns about implementation details and potential higher costs due to the increased protections.
Senior Minister of State for Manpower Koh Poh Koon highlighted that Singapore is one of the first countries to offer statutory protection to platform workers as a distinct group, acknowledging the complexity of regulating this rapidly evolving sector. Dr. Koh cautioned that the policy may not be flawless, stating, “We will have to make trade-offs and accept that not all issues and gaps in the platform space can be fully addressed through this legislation alone.”
Dr. Koh highlighted the inherent trade-offs, pointing out that while some MPs raised concerns about the increased costs resulting from the new law, they simultaneously advocated for greater protections, which would further drive up expenses.
“I raise this observation to make the point that where we have landed at this Bill today is a careful balance of the interests of the various stakeholders involved,” he said.
He added that the law includes provisions to prevent platform operators from shifting costs onto workers. Additionally, market competition serves as a self-regulating mechanism, as both workers and consumers have the option to switch platforms.
Dr. Koh also noted that costs related to work injury compensation and CPF contributions incurred by platform operators could be audited to guard against profiteering.
“Platform operators will need to consider how best to manage the costs. Consumers, too, will have a role to play,” he said, stressing that the increased costs tied to platform worker protections are similar to the business expenses that traditional employers already bear.
“It is a levelling up of what platform operators ought to have been paying… It will also ensure a level playing field for companies operating in Singapore to compete fairly in terms of business costs,” Dr Koh said.
He cautioned platform operators against introducing separate fees to reflect the additional costs, calling such actions “disingenuous.” “That would essentially mean passing the costs directly to customers,” he warned.
Dr Koh noted how MPs like Gan Thiam Poh (Ang Mo Kio GRC) had asked if the Government would consider reducing the phase-in period for higher CPF contributions.
