Do weak labour laws and definitions mean that retrenchment numbers are under-reported?

By: Leong Sze Hian

I refer to the article “More than nine in 10 companies paid retrenchment benefits in 2015: MOM survey” (Straits Times, Dec 28).

Retrenched workers increased 20% in 1 year?

“Some 15,580 workers were retrenched in 2015, up from 12,930 in 2014.”

Only sampling of establishments with 10 to 24 employees?

The survey yielded a response rate of 92.1%” – the “sample of retrenching establishments which employed 10 to 24 employees” may not be truly representative of all employers in this category.

In this connection, what was the response rate for this category? It may be likely that all those who did not respond may be more likely to be those that did not pay retrenchment benefits.

Establishments paying retrenchment benefits down from 95.7 to 90.6%

It states that “The proportion of establishments paying retrenchment benefits was 90.6 per cent in 2015, although it had fallen slightly from past years, a report by the Ministry of Manpower (MOM) revealed on Thursday (Dec 29).”

So many loopholes to be not in the retrenchment statistics?

If you are asked to resign – you may not be captured in the retrenchment statistics.

If you are terminated for whatever reason or no reason – you may not be captured in the retrenchment statistics.

The definition of Retrenchment may be problematic as it “refers to the termination of employment of a permanent employee due to redundancy“. In other words, as long as the employer says that the termination was not due to redundancy – it may not be captured in the retrenchment statistics.

If your employer has less than 10 employees – you may not be captured in the retrenchment statistics because the retrenchment survey does not cover this group of employers.

With the trend of increasing outsourcing, contract, freelance, part-time workers, etc – more people who lose their jobs may also not be captured in the retrenchment statistics, because it refers to only “permanent employee(s)”.

Also, with the trend of increasing outsourcing, contract, freelance, part-time workers, etc – the total “permanent” employees’ head count of employers may be reducing. Thus, there may be less employers with at least 10 or 25 employees.

So, as I understand it – as long as the employer does not call it a retrenchment exercise – which typically means a group of employees retrenched at the same time at one go – the employee who loses his or her job may also may not be captured in the retrenchment statistics.

67% of establishments paid retrenchment benefits to those who served less than 2 years, but how much?

With regard to “For employees who served less than 2 years and hence not eligible for retrenchment benefits, 2  in 3 (67%) establishments paid retrenchment benefits to them” – what was the quantum of the retrenchment benefits paid – very little?

Retrenchment legislation is so weak – report for what?

In the final analysis – what’s the point of a retrenchment report when the retrenchment legislation is so weak that there may be so many loopholes (as listed above) to not be captured in the retrenchment statistics?

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