Salary has always been a sensitive topic. But should it really be?
We are taught that it’s inappropriate to ask someone how much they are making. Yet many of us may invariably want to compare (or ‘benchmark’ is the more professional term to use) our salary with those of our peers, colleagues and sometimes, even our bosses.
Perhaps one reason for this curiosity is a lack of pay transparency. After all, if you are the only one sharing your pay details to everyone else including your prospective next employer, then you may feel that you are giving up information without receiving anything in return.
Is It Appropriate To Ask For A Person’s Last Drawn Salary?
The practice of businesses requesting a prospective employee’s last drawn salary and payslips is a common, but increasingly contentious one. While some employers may see it as a standard part of their hiring process, and a means to offer justified compensation without needing to overpay, many workers view it as unfair and potentially aimed at low-balling salaries.
The sensitivity around salary discussion is compounded by the desire to disconnect an individual’s worth from their income. A few may also argue that businesses should base offers on market rates or the candidate’s salary expectations, job scope and skill sets, rather than be dependent on their previous earnings, which may not accurately reflect their value.
Of course, an employer may also want this information because there isn’t a point in trying to hire a prospective employee and going through a rigid interview process, only to realise that the budget that they have set aside for the role is lower than what the person is currently already making at his current job. Such a situation would be a waste of time for both parties.
In Singapore, There Is No Legal Requirement For Employees To Disclose Their Last Drawn Salary
For employees, choosing to voluntarily reveal their past salaries can serve as a strategy to negotiating for a pay raise. After all, if an employee claims to be happy at the current place, one would expect that a higher salary to be offered to consider job switching.
Ultimately, employers may not change the practice of asking for last-drawn salaries. However, employees can choose not to disclose this information or seek employment in organisations with different practices if they strongly disagree. The key is understanding the logic behind the request and finding a balance that ensures equitable compensation for all parties involved.
Read Also: Why Employees’ Last Drawn Salary Still Matters To Hiring Managers
Deducting An Employee’s Salary
There are some companies that may have policies that allow them to (legally) deduct their employee’s salary. This isn’t something that an employee would want but The Employment Act do allow for it.
These include unauthorised absences, damaged or lost goods, provision of accommodations, amenities, and services, as well as for recovering advances, loans, unearned benefits, or overpaid salary. Employers must not exceed 25% of an employee’s monthly salary in most cases, although this limit may rise during contract termination.
The Employment Act also mandates employers to inform employees before making any salary deductions and not alter the terms of the employment contract without the employee’s consent.
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