We refer to the letters by Mr Shawn Low (Strengthen employment laws to protect retrenched staff, Jan 25) and Mr Too Kah Sam (Shape better work future by making retrenchment benefits mandatory, Feb 10).
Singapore’s approach to managing retrenchment is to protect our workers, while ensuring that employers have the flexibility to adjust to market conditions. This balanced ecosystem creates more good jobs, which ensures that when workers are retrenched, the chances of them finding another job would be high.
The tripartite partners had previously debated extensively the issue of whether a baseline retrenchment benefit should be legislated. We agreed that it does not guarantee better outcomes for workers. For example, legally mandating retrenchment benefits will affect the viability of employers that are already facing financial difficulties, putting other employees at risk.
According to our data, around nine in 10 eligible employees received retrenchment benefits. There is no one-size-fits-all approach towards retrenchment benefits, and there are other countries which similarly do not have mandatory retrenchment benefits.
Apart from retrenchment benefits, we have built an ecosystem of upstream and downstream measures to support workers that take into account changing business trends.
Upstream measures include encouraging and supporting workers to upskill and reskill, and build their employment resilience. Downstream measures include providing retrenched workers with employment facilitation.
There are also support programmes such as career conversion programmes, which provide salary support of up to 90 per cent for individuals to reskill themselves for new jobs. Such support programmes are updated regularly.
Nonetheless, we understand that retrenchment is a difficult and emotive process for employees. This is why the tripartite partners have worked closely together on the Tripartite Advisory on Managing Excess Manpower and Responsible Retrenchment, which guides employers in cutting costs to save jobs and use retrenchment only as the last resort.
Employers should carry out retrenchment, when unavoidable, responsibly and sensitively. Unionised companies should also engage their unions early, and work together to support the affected workers.
The tripartite partners stand committed to work together to protect workers’ interests and ensure that Singapore remains competitive to provide good jobs for our people.
Kandhavel Periyasamy
Divisional Director, Labour Relations and Workplaces Division
Ministry of Manpower
