Economic Defence Ordinance

Bill No. 7/1963

Read the first time on 28th November 1963.

An Ordinance to provide for monetary assistance to employees in certain businesses adversely affected by the severance of trade relations between Malaysia and Indonesia and for matters connected therewith.

Be it enacted by the Yang di-Pertuan Negara with the advice and consent of the Legislative Assembly of Singapore, as follows: —

Short title and commencement

1. This Ordinance may be cited as the Economic Defence Ordinance, 1963, and shall come into operation on such date as the Minister may, by notification in the Gazette, appoint.

Interpretation

2. In this Ordinance unless the context otherwise requires —

“contractor” means any person who contracts with an employer to carry out the whole or any part of any work undertaken by the employer in the course of, or for the purpose of, the employer’s trade or business and who is affected by the provisions of section 5 of this Ordinance;

“employee” means a person who has entered into an agreement, either written or oral, express or implied, to work for an employer or a contractor and who is affected by the provisions of section 5 of this Ordinance;

“employer” means any person affected by the provisions of section 5 of this Ordinance, who carries on or is engaged in the business of shipping between Singapore and Indonesia or in the business of rubber processing or in any business connected with sago, rattan, coffee, coconut oil or pepper or in any other business which may, from time to time, be declared by the Minister, by notification in the Gazette, to be a business for the purposes of this Ordinance;

“full employment” means employment at total monthly wages which are not less than the wages received by an employee from his employer or contractor immediately prior to the adverse effect on the business of the employer or contractor consequent solely on the severance of trade relations between Malaysia and Indonesia;

“partial employment” means —

(a)	in the case of an employee employed at a monthly rate, employment at reduced monthly wages;
(b)	in the case of an employee employed at a daily rate, employment at a reduced daily rate or for a reduced period during the month; and
(c)	in the case of an employee employed at a piece rate, employment at reduced work or at a reduced rate,

so that the employee’s total wages per month are less than the wages received by him from his employer or contractor immediately prior to the adverse effect on the business of the employer or contractor consequent solely on the severance of trade relations between Malaysia and Indonesia;

“the Fund” means the Economic Defence Fund established under section 4 of this Ordinance;

“wages” means the remuneration in money due to an employee, whether such remuneration is agreed to be paid monthly, weekly, daily or otherwise, and includes any allowance in money paid to an employee in respect of accommodation or food, or where food is supplied to an employee, the cost of such food to be reckoned at one dollar per day.

Appointment of officers

3.—(1) The Minister may appoint an officer to be styled the “Director of Economic Defence” (hereinafter in this Ordinance referred to as the “Director”), and may appoint such numbers of Assistant Directors as he may think fit.

(2) The Director shall have superintendence of all matters relating to this Ordinance, subject to the direction and control of the Minister.

(3) The Assistant Directors may perform all the duties imposed and exercise all the powers conferred on the Director by this Ordinance.

(4) All appointments made under this section shall be published in the Gazette.

Establishment of the Economic Defence Fund

4.—(1) For the purposes of this Ordinance, there shall be established a fund to be called the “Economic Defence Fund” into which shall be paid all sums required to be paid under the provisions of sections 7 and 8 of this Ordinance, and out of which shall be met all payments required to be paid under this Ordinance.

(2) The Fund shall be administered and controlled by the Director.

Termination of service prohibited for six months

5.—(1) No employer or contractor shall, by reason of any adverse effect on his business consequent solely on the severance of trade relations between Malaysia and Indonesia, terminate the services of an employee for a period of six months from a date to be determined by the Director as provided in this section.

(2) If the Director is satisfied, from information received from an employer, contractor or any other source, that for the reason set out in subsection (1) of this section, any employer or contractor is unable to provide full employment or is able to provide only partial employment to any of his employees, the Director may, after making such inquiries as he may deem necessary, determine the date from which the employer or contractor is unable to provide full employment or is able to provide only partial employment (hereinafter in this Ordinance referred to as the “relevant date”) and shall advise the employer or contractor in writing of the relevant date and of his obligations under this Ordinance.

(3) Nothing in subsection (2) of this section shall be construed as absolving an employer or contractor from notifying the Director in writing, in such form as the Director may require, that he is unable to provide full employment or is able to provide only partial employment to any of his employees.

(4) The decision of the Director as to the relevant date shall be final and binding and shall not be called in question in any court.

Liability to contribute to the Fund

6. From the relevant date, every employer shall, in respect of every employee employed by him or by his contractor, become liable to contribute to the Fund and shall continue to be liable for a period of six months from the relevant date.

Employer’s contributions

7.—(1) The employer shall pay into the Fund each month, for a period of six months from the relevant date, in respect of every employee of his or of his contractor, who is —

(a)	not provided with full employment during the month, a sum equal to one-third of the monthly wages such employee would have earned had he been fully employed, the quantum of such monthly wages to be determined by the Director as the Director thinks fit;
(b)	provided only with partial employment during the month, a sum equal to one-third of the wages such employee would have earned during the period he is not employed, the quantum of such wages to be determined by the Director as the Director thinks fit.

(2) Such sum shall, in the first instance, be paid into the Fund within seven days of the relevant date, and thereafter within seven days of the end of each month until the obligation of the employer under subsection (1) of this section is discharged. With every such payment, the employer shall furnish such particulars relating to the employee as the Director may require.

(3) The decision of the Director as to the quantum of wages under the provisions of subsection (1) of this section shall be final and binding and shall not be called in question in any court.

Government’s contributions

8. The Government shall contribute to the Fund each month an amount equal to the sum paid by the employer under subsection (1) of section 7 of this Ordinance.

Guarantee by employer

9. Within seven days of the determination by the Director of the relevant date under section 5 of this Ordinance, the employer shall furnish a banker’s guarantee acceptable to the Director to the effect that he is able to meet his full liability under subsection (1) of section 7 of this Ordinance as may be determined by the Director, in default of which he shall pay the full amount in respect of such liability to the Director.

Employee to continue to enjoy accommodation

10. Where an employee is provided by the employer or contractor with accommodation and any amenity or service pertaining or incidental thereto, the employee shall continue to enjoy the same during any period that he is in receipt of payments under the provisions of subsection (1) of section 13 of this Ordinance.

Employer, contractor and employee not liable to pay Central Provident Fund contributions

11. Notwithstanding the provisions of the Central Provident Fund Ordinance, no employer, contractor or employee shall be liable to pay contributions under the said Ordinance during any period that the employee is in receipt of payments under the provisions of subsection (1) of section 13 of this Ordinance (Cap. 150).

Employee not entitled to certain benefits

12. During any period that the employee is in receipt of payments under the provisions of subsection (1) of section 13 of this Ordinance, he shall not be entitled to any benefits in respect of holidays and annual leave as provided in sections 46 and 47 of the Labour Ordinance, 1955 (Ord. 40 of 1955), in sections 40 and 41 of the Shop Assistants Employment Ordinance, 1957 (Ord. 13 of 1957) or in sections 36 and 37 of the Clerks Employment Ordinance, 1957 (Ord. 14 of 1957), or to any award made under the provisions of the Industrial Relations Ordinance, 1960 (Ord. 20 of 1960).

Director to make payments out of the Fund

13.—(1) The Director shall pay each month out of the Fund to every employee for a period of six months from the relevant date, a sum equal to the monthly amount paid by the employer and by the Government on the employee’s behalf under the provisions respectively of sections 7 and 8 of this Ordinance.

(2) Upon the receipt of such amount from the Director, the employee shall have no further claim against the employer or contractor other than any wages that may be due to him in respect of partial employment.

(3) The Director shall keep full and complete records, in such form as he may think fit, of all payments made by him under the provisions of subsection (1) of this section.

Cessation of payments by employer

14.—(1) If, before the expiry of six months from the relevant date, the employer or contractor is able to offer full employment to the employee, the employer or contractor shall so inform the Director who, on being satisfied that the employer or contractor is able to pay wages, shall determine the date from which wages shall be paid and on which payments under this Ordinance shall cease. The Director shall advise the employer in writing accordingly, and the employer’s liability under section 6 of this Ordinance shall cease as from such date.

(2) Notwithstanding the provisions of subsection (1) of this section, the employer’s liability under this Ordinance shall revive if before the expiry of six months as aforesaid, he or the contractor is unable to provide full employment to the employee.

Payment to cease if employee refuses employment, etc

15.—(1) If an employee who is in receipt of payments under this Ordinance refuses, without reasonable excuse acceptable to the Director, an offer of —

(a)	employment made by the Director, at wages not less than the total amount received by him under the provisions of subsection (1) of section 13 of this Ordinance;
(b)	training made by the Director which would fit such employee for any employment which the Director considers suitable for him; or
(c)	full employment made by his employer under the provisions of subsection (1) of section 14 of this Ordinance,

the Director shall cease making any further payment to such employee under this Ordinance and shall inform him in writing of such cessation of payment and the reason therefor.

(2) If an employee is dissatisfied with any decision of the Director under the provisions of paragraph (a) or (b) of subsection (1) of this section, he may, within seven days of such decision, appeal to the Appeals Board appointed under subsection (3) of this section.

(3) For the purposes of hearing appeals under this section, the Minister shall appoint an Appeals Board consisting of such number of persons as he may think fit.

(4) The decision of the Appeals Board on every appeal under this section shall be final and binding and shall not be called in question in any court. The Appeals Board shall notify the Director and the employee concerned in writing of every such decision.

Termination of service

16.—(1) After the expiry of six months from the relevant date, the employer or the contractor may terminate the employee’s service with him.

(2) Upon such termination, the employer may set off the total amount paid by him in respect of an employee under the provisions of subsection (1) of section 7 of this Ordinance against wages payable in lieu of notice for terminating the service of the employee and against any other payment or award which may be payable or ordered to be paid arising from the termination of the employee’s service.

Recovery of sums due to the Fund

17. Any sum due to the Fund may be sued for and recovered by the Director as if it were a debt due to the Government.

Powers of the Director

18. The Director, or any person authorised in writing by the Director, may, for the purposes of this Ordinance —

(a)	put questions concerning an employee to his employer or contractor or to the employee himself, or to any other person whom he may consider it desirable to question; and such employer, contractor, employee or other person shall be legally bound to answer such questions truthfully to the best of his ability;
(b)	require the employer or contractor to produce to him any contract of service, books of account of wages, registers or other documents concerning his employees and to answer questions relating thereto;
(c)	summon any person to appear before him to inquire into any matter.

Extension

19. Notwithstanding the provisions of this Ordinance —

(a)	the Minister may, in his discretion, by notification in the Gazette, extend the period of six months mentioned in sections 5, 6, 7, 13, 14 and 16 of this Ordinance, for such further period or periods as he may think fit, in respect of all or any of the businesses mentioned in the definition of “employer” in section 2 of this Ordinance;
(b)	any period or periods during which an employee receives wages under the provisions of subsection (1) of section 14 of this Ordinance, shall, for the purposes of this Ordinance, be excluded from the said period of six months and any extended period as aforesaid.

Offences

20. Any employer or contractor, who —

(a)

for any purpose connected with this Ordinance —

(i)	knowingly makes any false statement; or
(ii)	produces or furnishes or causes or knowingly allows to be produced or furnished any document which he knows to be false in any material particular;

(b)

fails to pay to the Fund within the prescribed period any amount which he is liable under this Ordinance to pay in respect of an employee;

(c)

without reasonable excuse, the proof of which shall lie upon him, neglects or refuses to produce any contract of service, books of account of wages, registers or other documents concerning any employee or to answer any questions relating thereto as required under paragraph (b) of section 18 of this Ordinance; or

(d)

obstructs the Director or any person authorised in writing by the Director in the discharge of his functions,

shall be guilty of an offence under this Ordinance.

Penalties

21.—(1) Any employer or contractor who contravenes any of the provisions of this Ordinance or commits an offence under section 20 of this Ordinance shall be liable on conviction to a fine not exceeding two thousand dollars or to imprisonment for a term not exceeding one year for a first offence, and to a fine not exceeding five thousand dollars or to imprisonment for a term not exceeding three years for a second or subsequent offence.

(2) The Court before which such conviction is obtained may, in addition to such fine, order the employer to pay any amount payable under this Ordinance, certified by the Director as being due from such employer at the date of such conviction. Such amount shall be paid into the Fund and may be recovered according to the law for the time being in force for the recovery of fines.

Regulations

22.—(1) The Minister may make regulations for carrying out the provisions of this Ordinance.

(2) Such regulations may prescribe that any act or omission in contravention of the provisions of any regulation shall be an offence and may provide for the imposition of penalties for such offences, which penalties shall not exceed a fine of two thousand dollars.

(3) All regulations made under this section shall be published in the Gazette and shall be presented to the Legislative Assembly as soon as may be after publication and if a resolution is passed pursuant to a motion notice whereof has been given for a sitting day not later than the first available sitting day of the Assembly next after the expiry of three months from the date when such regulations are so presented annulling the regulations or any part thereof as from a specified date, such regulations or such part thereof as the case may be shall thereupon become void as from such date but without prejudice to the validity of anything previously done thereunder or to the making of new regulations.

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