NTUC urges employers to be fair, professional when carrying out retrenchments

June 7, 201610:48 am627 views

SINGAPORE: The labour movement is concerned that there could be companies that do not provide retrenchment payouts or serve sufficient notice to workers, given the likelihood that the slower economic growth could bring about more lay-offs.

The National Trades Union Congress (NTUC) on May 24 released revised tripartite guidelines to help employers be fair and professional in carrying out retrenchments, when they are inevitable. This is the second round of revisions, since the guidelines were issued in 2008.

In 2015, a total of 15,580 workers were laid off. According to NTUC, it is expecting a similar situation this year, where the numbers are as high. NTUC also said that in 2015, 48 unionised companies carried out retrenchment exercises in a fair and responsible manner, including giving workers early notice and paying them retrenchment benefits. There are 1,400 unionised companies in Singapore.

NTUC added that it has also been helping workers with retrenchment-related grievances. “They could be in the form of discrimination in the categories of people who are retrenched,” NTUC assistant secretary-general Patrick Tay said.

He added that some employers also lay off people near to festive seasons, which can be insensitive. Mr Tay said the revised guidelines can better help workers seek redress.

“For the unionised sector, the tripartite guidelines play a very important role. If the cases are being escalated – be it through the Ministry of Manpower or even to the industrial arbitration court – these guidelines will be highly persuasive in the course of representing workers and ensuring they get a good payout,” he said.

Added Mr Tay: “However, for the non-unionised sector, workers who fall within the ambit of the Employment Act can also file a grievance with the Ministry of Manpower. In the conciliation process, these tripartite guidelines can be used as a benchmark or a guide in resolving those disputes and grievances.”

The labour movement also said it will reach out to more employers, in the hope that they will use retrenchments only as a last resort. If retrenchments are inevitable, NTUC hopes these can be done in a fair, responsible, professional and sensitive manner.


Speaking to Channel NewsAsia, some companies said the guidelines must also take into account business interests.

President of Association of Small & Medium Enterprises, Kurt Wee, said: “We do agree with the more progressive HR practice. But I think if it becomes a kind of mandatory requirement that’s imposed on companies, then that may form a potentially a bit of a defensive mechanism to kick in.

“Companies might be more reluctant to re-hire because they are afraid that they might have retrenchment issues, or when they need to downsize, they have issues.”

Mr Wee also pointed out that most SMEs treat employees as part of their extended family. He said most firms will provide retrenchment benefits, especially for the older employees, if they have the capacity to do so.

“I think retrenchment is really the last resort. Retrenchment benefits is really a subject of whether the company has the reserves and the capacity to pay the retrenchment benefits or not. I think if they do, most companies are quite willing to look at some kind of retrenchment benefits that they can give to their employees, especially the older employees,” said Mr Wee.

More companies are also handling retrenchments in a professional and caring manner, according to a HR services firm.

Managing director of NeXT Career Consulting Group, Paul Heng, said: “They plan forward, and on the day of the retrenchment itself, I think counsellors are on standby. And they make the effort to have the employees spoken one-on-one. In the past, they tend to be much more focused on getting the news out to the employees en mass, so that is not very good.”

Mr Heng said he hopes that companies can also give workers longer notice periods, as they will need time to prepare and look for new jobs.

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