Annual leave for outsourced Progressive Wage Model workers to increase from 7 to 10 days from 2029

This increases by one day per year of service with the employer, up to a maximum entitlement of 14 days.

However, MOM noted that outsourced PWM workers may not be able to benefit from these leave entitlements due to the nature of their employment arrangements. 

For example, when a service contract changes hands, workers may be rehired by the new service provider while continuing in the same role or at the same worksite. But their leave entitlement may be reset to the minimum seven days, despite having worked continuously in the role for many years. 

“This means that outsourced PWM workers may lose their accumulated leave benefits despite working in the same role continuously for many years,” MOM said. 

The ministry added that tripartite partners had agreed to raise the minimum leave entitlement for such workers in order to “better reflect their continuous years of service”, and so that their employment conditions “remain protected” even when their employers change. 

During the Budget debate in February, assistant secretary-general of NTUC and MP Melvin Yong (PAP-Radin Mas) had called on the government to raise the baseline leave entitlement for PWM workers in outsourced sectors from seven to 10 days.

Mr Yong noted in February that many workers have their leave reset when service contracts change hands. 

“As a result, their leave stagnates at the statutory minimum of seven days, despite years of service in the same job scope,” he then said.

“By setting a higher baseline within PWM, we strengthen retention, recognise accumulated service, and improve workforce stability – while allowing service providers and service buyers to price this transparently into contracts in a sustainable manner.”