Country Garden Malaysia cuts close to 400 jobs

This article first appeared in The Edge Financial Daily, on January 22, 2020.
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KUALA LUMPUR: Country Garden Malaysia, the subsidiary of Hong Kong-listed Country Garden Holdings Co Ltd, has laid off hundreds of staff since December 2019.

It is said as a result of the company’s recent restructuring, nearly 400 personnel were given the option to accept a severance package and leave within 48 hours, or leave their jobs and negotiate for compensation with the company’s lawyers later. According to a source, the restructuring or what was called “manpower optimisation exercise” was announced in October 2019 through department meetings.

The company’s flagship development in Malaysia, Forest City, had apparently let go of at least 60% of its staff — Malaysians and China expatriates. More are expected to leave after the Lunar New Year, with another two rounds of downsizing in March and June. As at March 2019, Forest City, in Johor, had 1,078 Malaysians and 296 expatriate staff.

When contacted, an officer in the Johor Baru Labour Department said it has not received any retrenchment notice from Country Garden Malaysia.

According to the Employment Act 1955 (EA) and the Employment (Termination and Lay Off Benefits) Regulations 1980, employers are required to report retrenchments, voluntary separations, temporary lay-offs or employee pay cuts to the nearest Labour Office before any termination action. Failure to do so is an offence under the EA and the employer could be fined not more than RM10,000 for each offence.

“For any job cuts of more than five persons, the company must report to the Labour Office and furnish details such as compensation packages and reasons of retrenchment. If the terms are unfair to employees, we [officers] will step in to protect the employees’ rights,” said the officer.

 

Internal merging

It is said the job cuts were triggered by the company merging its four subsidiaries undertaking various projects in Malaysia. Sources said former regional president for Malaysia and Singapore Jason Fu’s role changed thereafter, so he resigned, with Jan 15 being his last day.

Fu joined Country Garden Holdings in September 2015 and was the face of Country Garden Malaysia.

He was involved in its Forest City project, which has an estimated gross development value of RM450 billion, and the 80-acre (32.38ha) Lake City @ KL North development, which saw its first residential launch in August 2019.

Other Country Garden Malaysia projects include Country Garden Diamond City in Semenyih, Selangor; Country Garden Central Park in Tampoi and Country Garden Danga Bay, both in Johor Baru.

Su Bai Yuan, taking over Fu, is Country Garden’s Forest City chief executive officer and Country Garden Holdings executive director.

When contacted, Country Garden Malaysia said Fu’s resignation is “to focus on his personal pursuits”.

In a statement to EdgeProp.my, it said the downsizing’s objective is to “cultivate the Malaysian market and have a unified interface within all sectors”.

It explained that it recently carried out a Malaysia-Singapore region integration combining the Malaysian office managing Danga Bay, Central Park, Diamond City and Lake City-KL North, with the Forest City office.

“During the integration, the organisation saw the need to manage overlapping skills and talents. Some of the talents were transferred to other departments that fit their skills, while some were reassigned to other projects.

“For those deciding to leave, their service was recognised with a fair package with a consensual understanding between both parties. The process was executed in accordance with Malaysia’s labour laws,” Country Garden Malaysia said in the statement.

 

Auctioning of company’s cars

Meanwhile, in a document sighted by EdgeProp.my, 63 cars registered under Country Garden Malaysia subsidiaries have been listed for public auction, slated for February.

The cars include luxury sedans, four-wheel drives, multi purpose and sport utility vehicles and compact cars manufactured between 2011 and 2018. Their reserve prices are between RM1,600 and RM119,200, totalling RM1.92 million.

Country Garden Malaysia described the car auction as part of its asset management where a systematic approach is taken to manage the organisation’s tangible or intangible assets.

“This includes disposing of company vehicles after several years. It is a standard approach taken by any organisation in this country.

“Vehicles exceeding their shelf lives in serving the organisation will first be offered to employees interested to own them at a lower-than-market price [via an auction]. Thereafter, the remaining vehicles will be sold to the public,” the company said.


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