Platform Workers Act to drive industry costs higher by $493m a year

Workplace injury compensation insurance could add up to $42.88m annually.

The Platform Workers Act is projected to increase annual costs for the platform industry by approximately $493.85m (US$368m) over the next five years, according to a report by Momentum Works. 

This cost includes employer Central Provident Fund contributions mandated by the act, with workplace injury compensation insurance adding up to $42.95m (US$32m) annually. 

Platforms will need to adapt their business models to accommodate these additional expenses, according to Jianggan Li, founder and CEO of Momentum Works. 

Larger platforms are likely to absorb the highest costs and may pass these increases on to consumers. In contrast, smaller platforms might need to reassess their viability under the new requirements, he added. “

"We may see prices for platform services going up, which could dampen the demand for their services initially, but ultimately increased prices will better reflect the true cost of fair labour practices in the long term,” Li said.

(1 USD = 1.34 SGD)