Industrial Arbitration Court rules SBS Transit's collective agreements did not breach Employment Act

Industrial Arbitration Court rules SBS Transit's collective agreements did not breach Employment Act

sbs transit public bus
File photo of SBS Transit buses. (Photo: Jeremy Long)

SINGAPORE: Clauses in several collective agreements between bus operator, SBS Transit and the National Transport Workers’ Union (NTWU) do not breach the Employment Act, according to a ruling by the Industrial Arbitration Court (IAC).

This follows claims made by five bus drivers in the Magistrates' Court, suing SBS Transit for underpaying them for overtime hours. They had also accused the transport operator of getting them to work more than 44 hours a week in breach of the Employment Act. 

SBS Transit made an application to refer the wage disputes to the IAC in October.

IAC arbitrates industrial disputes and certifies collective agreements between unions and employers.

READ: SBS Transit turns to Industrial Arbitration Court in wage dispute with 5 bus drivers

Justice Chan Seng Onn ruled that SBS Transit was not in breach of regulations regarding rest days, overtime pay and caps on working hours in his written decision published on Wednesday (Nov 13).

Justice Chan, who is the IAC president, referred to samples of bus captains’ employment contracts and roster, pay computations and the entry salary of a new Singaporean bus captain who is required to work 48 hours a week, which includes four hours of “built-in overtime”.

Bus captains breach their contract if they refuse to perform the four hours of built-in overtime.

"In determining whether there is a breach of the statutory limits for working hours, I adopt the same meaning for 'hours of work' as that defined in the Employment Act and not that adopted by the employers in their employment contracts with bus captains.

"In addition, I have to treat the built-in overtime of four hours per week as part of the normal contractual working hours of the employee and not as overtime per se, which should always be optional for the employee."

Under the Employment Act, employees are not required under their contract of service to work more than 44 hours in one week. Employers are also required to pay them at least 1.5 times the hourly basic rate of pay for hours worked beyond the 44 hours.

Since the bus captains are given a minimum daily rest period of 45 minutes for breaks and meal times, in total they work only 43.5 hours per week, said Justice Chan.

This therefore did not breach the Employment Act.

He also found that SBS Transit complied with laws on overtime work. For one, the company starts “paying overtime at 1.5 times the employee’s hourly basic rate of pay for hours of work exceeding 7.25 hours in one day or 43.5 hours in one week”.

However, Justice Chan noted that the language adopted by NTWU and SBS Transit in structuring their work arrangement is different from what has been defined under the Employment Act. 

“The Court notes that the meaning of “hours of work” or “working hours” and the practice of “built-in overtime” adopted by the employers and the union in structuring the work arrangements is different from that as defined or envisaged under the Employment Act,” he wrote.

“This can result in confusion when determining whether there has been compliance with the Employment Act. It can also lead to misunderstanding."

It will be up to the employers and the union to decide if they should review all their work arrangements for bus captains and adopt instead the same definitions as those set out in the Employment Act, he added.

Ms Tammy Tan, the senior vice president of corporate communications at SBS Transit said: “ We thank the IAC for recognising that we have not only acted in accordance with our obligations, but have gone further for the benefit of our Bus Captains."

In response to the IAC’s ruling, NTWU’s executive secretary Mr Melvin Yong said that his organisation will continue to work closely with SBS Transit to ensure that the terms in their collective agreements “remain competitive and are always beneficial to our members".

The court did not hear the claims of the five bus captains who have commenced proceedings in the State Courts against SBS Transit.

Source: CNA/rp