Singapore govt urges 'responsible retrenchment'

The National Wages Council advises employers to be flexible when managing excess manpower amid COVID-19

Singapore govt urges 'responsible retrenchment'

Implement other cost-cutting measures like wage adjustments before resorting to retrenchments during the COVID-19 outbreak, urged the National Wages Council (NWC).

In Singapore’s annual wage guidelines announced yesterday (30 March), the NWC called on employers to conduct retrenchment exercises in a responsible manner.

They also offered recommendations on managing excess manpower. This is in line with the Ministry of Manpower’s recent retrenchment advisory.

“The NWC reaffirms the approach of having employers recognise the need to take a long-term view of their manpower needs, including the need to maintain a strong Singaporean core, notwithstanding the economic uncertainty brought on by COVID-19,” said NWC.

To cope with the oncoming recession, employers can manage excess manpower by:

  • Focus on training and upskilling
  • Adopt flexi-work schedules: For example, employers can reduce weekly morning hours without adjusting wages by creating a “time bank” of unused working hours. The banked hours can be used to offset future increase in hours during peak periods.
  • Support affected employees who wish to seek a second job or temporary work to supplement their income

If retrenchment remains a necessary measure, the NWC urged employers to abide by MOM’s guidelines, and conduct an unbiased and fair exercise with empathy – such as offering longer notice periods as well as ample benefits to affected workers.

Employers should also help affected employees look for alternative jobs in associate companies, other companies or through outplacement assistance programs.

The council advised employers to work with the various employee unions to address any issues.

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