TL;DR – That’s what the unions are for.
Earlier this year, Surbana Jurong announced that it was sacking 54 staff. The entire HR exercise was a demonstration of how not to HR. After the public furore, which included public statements from the unions, Surbana finally realised the errors of its ways and worked closely with the unions to provide an “equitable and mutually agreeable arrangement” for the affected workers.
Minister Lim Swee Say, Minister for Manpower, provided an update to Parliament about the outcome of the negotiations between Surbana and the unions. According to Minister Lim, Surbana has agreed to give the 54 employees they sacked an ex-gratia payment.
What’s ex-gratia payment?
An ex-gratia payment is a sum of money that is paid when there was no obligation or liability to pay it. For example, unlike retrenchment, a company really doesn’t have to provide any additional compensation to the staff it sacks. However, in the case of Surbana, they are going to give the 54 employees they sack a sum of money. How much is that sum? We don’t know. It’s not reported.
But according to Minister Lim:
“Our view is that this settlement is a fair one”
That said, Minister Lim still has some harsh words for Surbana:
“I spent many years with the labour movement and now MOM. To the best of my recollection, this is the first time an employer has conducted such a major termination exercise and announced publicly it was due to the workers’ poor performance. As Manpower Minister, it is something I do not find acceptable.”
Minister Lim emphasized that both employees and employers need to work together for proper performance management. Employers need to ensure that their employees are aware of the relevant and objective performance criteria of the company. These criteria need to be fairly applied. Employees performance need to be properly documented.
And if an employee is sacked because of poor performance, the employer would need to show documented evidence that the employee’s performance was poor. Otherwise, the termination will be considered unlawful. The employer may be ordered to reinstate the employee, or to provide compensation.
If there is any good that can come out of this unfortunate episode, we hope it is that more people are aware of their rights. If you think that you are unlawfully sacked, you can file an appeal on unfair termination to MOM. According to Minister Lim, MOM receives more than 200 cases of such appeals per year. Most are resolved through mediation. But on average, employers are ordered to compensate affected employees in about 10 cases every year.
And if you are part of a union, you should know that the union needs to be informed before you are sacked. In this particular episode, Surbana didn’t involve the unions before sacking the 54 employees. Thankfully, the unions didn’t let Surbana get away with its terrible HR practices. Because of the actions of the union, an acceptable agreement was reached.
Here, in case you’d missed it, here’s the rather strongly worded Facebook post by the Building Construction And Timber Industries Employees’ Union (BATU) when the case ‘erupted’.
And the icing on the cake is that Surbana is now reviewing their performance management processes to improve their system. Let’s hope that this is the last time such things happen.
Or, in the words of Minister Lim:
” I hope we will not come across another case where a company does a major termination and labels employees as having poor performance publicly”