SNEF reminds employers to retrench responsibly despite business troubles

SINGAPORE – Singapore’s trade union for employers has reminded them to responsibly manage excess manpower and retrench workers only as a last resort.

The Singapore National Employers Federation’s (SNEF) statement on Jan 11 come after similar comments were made recently by its partners in the labour movement and Government.

They come amid a resurgence in high-profile mass layoffs that hit the technology and finance sectors in recent weeks, harking back to the widespread retrenchments when the Covid-19 pandemic abated.

SNEF said the latest finalised labour data from the Ministry of Manpower for the third quarter of 2023 showed a rise in the number and incidence of retrenchments.

It also noted that retrenching employers cited reorganisation or restructuring as the main reason for retrenchments.

“Coupled with subdued external demand, increased cost pressures, and concerns of a recession, it may be necessary for some employers to make reductions to their workforce, in order to remain sustainable,” SNEF said.

Still, retrenchments should be considered as a measure of last resort, only done when downsizing as a part of business transformation is inevitable, it said.

“Employers recognise the need to take a long-term view of their manpower needs, and preserve jobs even as they transform, as this will allow them to retain capacity and capability within the organisation.”

To this end, it called for employers to redeploy and reskill workers where possible even amid business transformation to cope with the changing operating environment.

Regional e-commerce firm Lazada was the most prominent firm to lay off in Singapore recently.

It reportedly cut around 100 workers here between Jan 3 and 5, as part of wider plans to cut between 25 per cent to 50 per cent of its South-East Asian head count.

The unionised firm drew flak from workers, the public and the Food, Drinks and Allied Workers Union over the amount of severance payouts offered, treatment of affected staff, and its failure to inform the union of the exercise in advance.

Lazada operates under the Alibaba International Digital Commerce (AIDC) business unit of the Chinese tech behemoth.

The timing of the layoffs has increased speculation of an upcoming initial public offering in the United States for AIDC.

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