Wage Credit Scheme
The Wage Credit Scheme (WCS) supports businesses embarking on transformation efforts and encourages employers to share productivity gains with workers by co-funding wage increases. It was introduced in Budget 2013 and extended in Budget 2015 and Budget 2018.
Under the Wage Credit Scheme (WCS) introduced in Budget 2013 and extended in Budget 2015, the Government co-funded 40% of wage increases from 2013-2015 and 20% of wage increases from 2016-2017 given to Singapore Citizen employees who earned a gross monthly wage of up to $4,000. Only employers are eligible for the co-funding.
In Budget 2018, it was announced that the WCS would be extended for three more years, i.e. 2018, 2019 and 2020, to support businesses embarking on transformation efforts and encourage sharing of productivity gains with workers. Government co-funding was maintained at 20% in 2018.
In Budget 2020, it was announced that the government co-funding ratios for wage increases in 2019 and 2020 will be raised from the current 15% and 10%, to 20% and 15% respectively. The qualifying gross wage ceiling will also be raised to $5,000 for both years, up from the current $4,000.
The government co-funding ratios for wage increases in 2019 and 2020 will be raised to 20% and 15% respectively. The qualifying gross wage ceiling will also be raised to $5,000 for both years. Qualifying employers benefitting from the enhancements for the 2019 wage increases will be notified by end Jun 2020, and will receive a supplementary payout thereafter.
All employers giving wage increases in 2013 – 2020 to Singapore Citizen employees who:
• Received CPF contributions from a single employer for at least 3 calendar months* in the preceding year
• Have been on the employer’s payroll for at least 3 calendar months* in the qualifying year (i.e. employer must have paid employee CPF contributions for at least three calendar months* in qualifying year)
• Have at least $50 gross monthly wage increase (up to the Gross Monthly Wage ceiling)
• Must not also be the business owner of the same entity (i.e. sole proprietor of the sole proprietorship, or a partner of the partnership, or both a shareholder and director of a company)