Minister Tan See Leng Emphasizes Balance Between Business Flexibility and Worker Protection
In addressing the issue of retrenchments in Singapore, Minister for Manpower Tan See Leng stressed the importance of flexibility for businesses while ensuring the protection of workers. His comments came on February 5 in response to parliamentary questions regarding retrenchment practices following the actions of e-commerce company Lazada.
Singapore’s Retrenchment Approach
Tan acknowledged calls for stronger worker protection, noting that despite the absence of a legal mandate for retrenchment benefits, around 90% of eligible employees received such benefits between 2019 and 2023. He defended the country’s current retrenchment framework, emphasizing its balance between protecting employees and allowing businesses the flexibility to adjust to changing market conditions.
Case of Lazada
The Minister also responded to concerns raised about Lazada’s recent retrenchments, where an undisclosed number of workers were let go without prior consultation with the Food, Drinks, and Allied Workers Union (FDAWU). Tan highlighted that the Ministry of Manpower (MOM) stepped in to mediate discussions between Lazada and the union, resulting in a fair resolution—showcasing the success of Singapore’s tripartism model. He contrasted this with how similar situations might have played out more confrontationally in other countries, potentially leading to longer-term conflicts.
Fair and Responsible Retrenchment Practices
Regarding broader retrenchment practices, Tan assured that Singapore’s system allows for flexibility for businesses while also ensuring that workers’ rights are protected. Employers are legally required to notify MOM within five days of carrying out retrenchment exercises, and the Ministry engages in efforts to educate employees and encourage responsible actions.
Union Agreements and Disputes
Tan also addressed concerns about whether collective agreements should be made mandatory for unionized companies. He reiterated that Singapore’s approach allows employers and unions to decide on these agreements voluntarily, with disputes being raised for conciliation by MOM, or if needed, arbitration in the Industrial Arbitration Court.
