Singapore employers told to retrench on merit, but also retain more locals

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SINGAPORE (Oct 17): Selection of employees to be retrenched in Singapore should be based on objective criteria with primary considerations given to employee merit and preserving skills to ensure business sustainability.

Employers should also take a long-term view of their manpower needs, including the need to maintain a strong Singaporean core.

Retrenchments should generally not result in a reduced proportion of local employees and it can be achieved by retaining proportionately more locals during a retrenchment exercise.

This is according to Tripartite Partners’ updated advisory on Managing Excess Manpower and Responsible Retrenchment with Key Principles on Fair Retrenchment, released here today.

Tripartite Partners are the republic’s Ministry of Manpower (MOM), the National Trades Union Congress (NTUC), and Singapore National Employers Federation (SNEF).

The updated advisory is to provide employers with clearer guidance on carrying out a retrenchment exercise responsibly, if it is inevitable, said the Tripartite Partners.

“Even as we aim to strengthen our Singaporean core, Singapore remains open and welcomes foreigners who can help grow our economy and create good jobs for locals.

“Local employees are encouraged to acquire new capabilities from foreign employees with specialised skills,” said the partners.

They said companies should also at all times put in effort so that niche or business-critical skills of the foreign employees could be transferred to local employees in the longer term.

The Tripartite Partners last updated the advisory in March 2020, in view of the evolving Covid-19 situation which has affected businesses.

As retrenchments may still be inevitable for some employers even with the many support schemes rolled out by the Singapore government, the advisory has been further updated to emphasise the key desired outcomes in any retrenchment exercise, said the partners.

Tripartism in Singapore refers to the collaboration among unions, employers and the government.