Managing Attrition in the Process Industry During COVID-19

04 November 2020, Singapore – While the Process Industry is slowly picking itself up amidst COVID-19, there is an increased need for employers to exercise care and caution when implementing acts of termination, dismissal and retrenchment. As such, ASPRI’s Knowledge, Education, Experience & Networking (KEEN) Work Group has worked with Mr Shanmugam, Counsel from Netto & Magin LLC, to organise the third instalment of the COVID-19 Legal Webinar Series. The webinar titled, “Managing Attrition in the Process Industry” aimed to provide ASPRI members with the insights on handling such difficult issues during these challenging times.

At the start of his presentation, Mr Shanmugam emphasised that retrenchment should only be done as a last resort. He shared the alternatives to retrenchment which employers should consider. First, employers could send employees for training to allow them to upgrade their skills and enhance their employability. Secondly, employers can redeploy employees to alternative areas of work within the company. Employers could also consider implementing flexible work schedules or arrangements to promote shorter work-week. Lastly, employers could adjust the wages of employees but they have to be in line with tripartite norms.

Mr Shanmugam further reiterated that retrenchment should only be considered after reviewing the aforementioned alternatives first. He added that retrenchment posed a challenge for all parties involved, especially for the affected employees and their families. As such, it is important that employees are treated with dignity and respect during a retrenchment exercise.

When carrying out a retrenchment exercise, the selection of employees should be conducted fairly; based on the objective criteria such as the ability of the employee to contribute to the company’s future business needs. Mr Shanmugam further elaborated that employers should not discriminate against any particular group on grounds of age, race, gender, religion, marital status, family responsibility and disability.

Mr Shanmugam then gave a breakdown of three different case studies – one which is an example of a bad retrenchment exercise, while the other two are examples of good retrenchment exercises.

The main key takeaway is that companies must notify the affected employees in advance about their retrenchments. If possible, companies should also assist the affected employees regarding job placement facilitation. Any retrenchment benefits should be designed with the company’s financial situation in mind. Should they lack the means of assisting their employees, they could always seek help from the Government.

Finally, the webinar transited into a Q&A session where members got the opportunity to clarify their concerns with Mr Shanmugam. ASPRI would like to thank both our members and Mr Shanmugam for attending and making this webinar possible.

Resources:

1. Mr Shanmugam’s slides
2. Case Studies
3. Recording of webinar