Business costs here are set to increase as a new licensing framework for cleaning companies requires them to factor in higher wages for cleaners into new contracts or when renewing existing ones.

From April, businesses negotiating a new contract with a cleaning company will have to pay a minimum monthly wage of $1,000 for a general cleaner, and this could rise to at least $1,600 or more for supervisory cleaners for office and commercial buildings, and food and beverage establishments. For town councils and public cleaning, a supervisor will have to be paid a minimum of $1,700.

Firms with existing cleaning contracts will have until September to transition to this new regime.

The Environmental Public Health (EPH) Amendment Bill, introduced in Parliament on Monday, will mandate cleaning companies to be licensed. One of the conditions is that they pay their employees progressive wages, to ensure cheap sourcing in the cleaning sector.

The sector is prone to headcount-based contracting and contracts are typically awarded based solely on price considerations, the National Environment Agency (NEA) said in a statement yesterday. "This can result in cleaning businesses compromising on wages and employment standards of cleaners in order to be price competitive," NEA explained.

As a result, all licensed cleaning businesses will be required to pay their resident (Singapore citizens and PRs) cleaners progressive wages based on the Progressive Wage Model recommended by the Tripartite Cluster for Cleaners (TCC). The TCC, established to develop a progressive wage scale for cleaners, is co-chaired by the NTUC and the Singapore National Employers Federation and comprises tripartite representatives from the government, unions, employers and industry stakeholders.

The Progressive Wage Model developed by the TCC has three wage ladders for three broad categories of cleaning jobs - office & commercial buildings, F&B establishments and the conservancy sector. In addition to the starting wage level in each category, each salary ladder comprises a series of further wage points to provide a path for cleaners to progress to higher wages.

For this to happen, the licensing regime will set a training condition that stipulates that all cleaning businesses should have at least 50 per cent of their staff trained in at least one module within the Singapore Workforce Development Agency's (WDA) WSQ EC framework at the point of first application. This will be increased to 100 per cent of its headcount by the time the licence is renewed by September 2015.

"In preparation for the licensing of cleaning contractors, WDA has been working with our training partners since mid-2012 to ramp up training capacities. Funding is also available to support the training of resident cleaners. The government has set aside a $9.8 million grant to train 33,000 local cleaners in EC WSQ over two years," said Ng Cher Pong, chief executive of WDA.

Besides these, other licensing conditions require cleaning businesses to be registered with the Accounting and Corporate Regulatory Authority (Acra) Singapore or the Registry of Societies (ROS), and demonstrate relevant experience of having at least one contract on-hand or completed in the 12 months before the licence application. New startups may provide documentation to indicate employment of at least one employee with a minimum of two years of practical experience in supervising cleaning work, or has attended the requisite EC WSQ training modules.

To promote compliance of the regime, cleaning businesses found operating without a valid licence will be liable to a maximum fine of $10,000 or up to 12 months imprisonment or both and $1,000 every day for continuing offences. Service buyers who engage unlicensed cleaning businesses will also be liable to a maximum fine of $10,000 and $1,000 each day for continuing offences. Licensed cleaning businesses found to be in breach of licensing conditions may also face a maximum financial penalty of $5,000 and may risk having their licence suspended or revoked.