More payout for retrenched Lazada employees; some to get extra 2 weeks’ pay per year of service

SINGAPORE - After months of waiting, former employees of e-commerce giant Lazada, who were laid off in January, have finally been told how much more in payouts they will be receiving.

Some of them will receive an extra two weeks’ pay per year of service, paid out in about two weeks’ time, while others will receive only “training support” of $1,200, to be paid out in August, according to several former employees who spoke to The Straits Times on condition of anonymity.

The former employees were from Lazada Singapore and Lazada South-east Asia. They had

initially received two weeks’ pay per year of service,

which is below industry norms.

In response to queries, Ms Julie Cheong, president of the Food, Drinks and Allied Workers Union (FDAWU) – which had negotiated with Lazada for the additional benefits – said the payouts take into consideration the employees’ length of service with Lazada, their job grades and the validity of their membership with FDAWU.

“This implies that a uniform payout is not applicable. More details relating to the payout cannot be shared due to a confidentiality clause in an agreement signed between FDAWU and Lazada Singapore,” she said on May 23.

National Trades Union Congress (NTUC) secretary-general Ng Chee Meng said in a Facebook post on May 21 that the union was closing matters with affected eligible union members.

“They have engaged directly with affected members, gathered and verified all necessary information, and determined the optimal distribution approach to the union’s members. The FDAWU has gone above and beyond to champion the interests of its members during this period.”

Lazada did not respond to ST’s request for comment.

In January, Lazada 

let go of an undisclosed number of its Singapore workforce

without informing the union, despite these workers being unionised. Sources said at the time the company planned to cut between 25 per cent and 50 per cent of its South-east Asia headcount, while media reports speculated that at least 100 people were laid off in Singapore. The cuts spanned various departments across the company as well as its regional offices in countries including Malaysia, Indonesia and Vietnam.

The laid-off workers were offered two weeks’ pay for each year of service. The FDAWU then said that it was negotiating with Lazada for better benefits for them, with the Ministry of Manpower facilitating talks.

On Feb 4, NTUC, FDAWU and Lazada said in a joint statement

that they had arrived at an amicable settlement.

Mr Ng said separately that eligible union members would have “an enhanced package mirroring unionised norms”. This typically refers to one month’s salary per year of service.

A former manager, who worked at Lazada Singapore for less than five years, told ST that she was contacted last week and asked to choose a timeslot on May 20 to meet the union. She attended a group briefing and then met a union representative who explained her additional benefits – two weeks’ pay per year of service, which she feels is the basic amount the employees deserve.

“Although there are no MOM guidelines saying we should get one month’s pay per year of service, in this industry it’s common to get that amount or even more,” she said.

“At least the wait is over and the result is satisfactory,” she added.

Meanwhile, a former department head from Lazada South-east Asia, who had worked for less than three years, said he received a call on May 21 and was told he will be receiving $1,200 as “training support”. He had previously been earning more than $10,000 a month at the company.

He said that he was unhappy about the payout after months of waiting. “There was no explanation about who was eligible for the enhanced benefits package and why,” he added.