DFS ought to be punished for not adhering to guidelines and for failing their employees

By October 10, 2019Current

TL;DR – Shame on them.

Very very very disappointed and angry with DFS.

Yes, I’m talking about DFS Group’s retrenchment exercise which took place recently.

Didn’t they learn anything from the retrenchment exercises that other companies carried out?

How can they be such sneaky and irresponsible employer? Are they totally out of touch?

From the entire episode, what puts me off the most is how they had absolutely failed their employees, many long-serving, in so many ways by not doing them right. And, for not following the MOM’s retrenchment guidelines.

Yes, you read that right, they didn’t.

Let me explain.

They DID NOT notify the MOM of the retrenchment


Based on the Tripartite Guidelines on Mandatory Retrenchment Notifications, employers with businesses registered in Singapore who employ at least 10 employees are required to notify MOM if five or more employees are retrenched within any 6-month period. Any Singapore-registered company worth their salt would know this. And mind you, DFS has been operating in Singapore for 38 years.

Has the HR department been sleeping all this time?

And you asked, What are the retrenchment benefits?

Their initial offer, before the intervention of MOM and TAFEP, was pathetic.

Prior to the Tripartite Alliance for Fair and Progressive Employment Practices (TAFEP)’s involvement in DFS Group’s retrenchment exercise, the retrenched employees were only offered one week’s pay for each year of service, capped at 13 years of service — which was below the minimum compensation stipulated in MOM’s guidelines on retrenchment.

The employees were later offered with “better” retrenchment package.

But better, really? The second offer came and it was two weeks’ salary for each year of service, and again, capped at 13 years of service. Well, this might be better than the initial offer, but hey, they’re comparing to a sickeningly low base.

And how is this fair to the affected employees? That’s like doing the minimal and pretending to show some effort to meet the barest minimum guidelines. I say they’re just trying to see if they can pull a fast one on TAFEP.

And to think some of the employees have worked for the company for more than 40 (!!!) years.

“In this whole exercise, money is the top consideration, not people. That’s what made us feel very, very upset. We are like a piece of used tissue paper,” said one former employee.

Geez, I can’t imagine how shocked, hurt and disappointed they must have been feeling when they were hit with the sudden news that they’re going to lose their jobs.

No warning, no dialogue, no notice period given to the retrenched workers

According to the retrenchment guidelines, DFS should communicate the intentions for retrenchment to their employees early and before the public notice of retrenchment is given.

But nope, they didn’t.

Can you imagine turning up for work one day like you always do, only to be served with a letter of notice, informing you that you are out of job and you are to leave immediately, without any heads up or any proper communication from  your employer?

And some staff also said that year after year, the DFS management had been telling them that the company was doing well and it was making money.

DFS sure did their employees dirty with their irresponsible retrenchment

Judging from how the entire exercise is being handled, what may seem “like a surprise nuclear bomb” to the employees, probably meant nothing to the company.

“It really is so cruel. Most of us have children or parents to take care of, and they didn’t even warn us about the retrenchment,” said one of the affected staff who has worked for the company for more than 30 years.

While another staff said,

“I don’t think this is the right way to treat your employees. They never asked us about family background and whether we can survive if we don’t have a job. I just wish they would be more caring,” as she shared about how her sick husband would unlikely be able to work for a long time and how her two children were still in school.

I mean, it’s the real people and real lives of 60 over employees that we are talking about here!

Unfortunately, DFS probably didn’t really care a hoot about whether or not the employees can handle the sudden loss of a job, be it financially and emotionally.


Would things have been better if DFS Group was an unionised company?

Yes, definitely.

If DFS Group was a unionized company, the Singapore Manual and Mercantile Workers Union (SMMWU) would have been consulted before the retrenchment exercise.

SMMWU would also be involved in negotiating for the workers and facilitating them as they undergo the retrenchment exercise.

In case you don’t already know, for the retrenchment package, the norm in unionised sectors is for companies to pay one month of salary for each year of service, capped at 25 years.

And according to National Trades Union Congress (NTUC) assistant secretary-general Patrick Tay, retrenchment benefits in unionised environments are always one month per year of service. And in some instances, there is no cap.

But whereas for non-unionised companies, the prevailing norm is to pay a retrenchment benefit of between two weeks to one month salary per year of service, depending on the company’s financial position and the industry.

Of course, “A union isn’t just about money, but also helping them to find alternative jobs”, said the secretary-general of the SMMWU, David Yeo.

In other words, besides ensuring that the retrenched employees get their compensation, the union would also be involved in helping the affected employees in finding alternative jobs. They may also help workers identify relevant training – if they have to be retrained and reskilled – to enhance their employability.

What happens when a unionized company needs to retrench employees?

If you recall, around this time last year, StarHub had to cut 300 jobs as part of their restructuring exercise.

The Singapore Industrial and Services Employees’ Union (SISEU) was consulted for the retrenchment exercise. And during the process, StarHub had also worked with affiliated companies, NTUC’s Employment and Employability Institute (e2i), and government agencies, to help affected employees find suitable new jobs.

Aside from the compensation package, StarHub also offered counselling services such as coaching and skills upgrading to the affected employees.

Let me remind you again that all of these were only possible because StarHub is an unionised company.

The workers had the union to turn to, which helped to see through the entire exercise, to help them fight for fair treatment and compensation package.

Lastly, at the risk of sounding like a broken record, we have mentioned this before: Retrenchment should not be the first resort, but the last resort.

Just as what Manpower Minister Josephine Teo said in her Facebook post, should DFS find themselves with excess manpower, they should first consider re-deploying the affected staff to other business units or functions first before they retrench them.

And today, we still stand by this belief.

I’m not sure if retrenchment was DFS Group’s last resort, but fine, I’ll give them the benefit of doubt.

Meanwhile, it had previously been reported that a total of 500 employees would be affected by DFS’s decision to withdraw from Changi Airport, and DFS said they would be offered options regarding their employment. This will take effect in June 2020. So, other than the 60 staff who had already been served notice, we can expect hundreds more DFS staff who will be retrenched at a later stage. Will DFS do better the second time around?

So, let us keep our eyes fixed on DFS.


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Author JW

I am nice, most of the time!

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