Union slams severance packages for DFS staff

It says improved terms not substantial enough, plans to help workers negotiate

The severance packages for retrenched employees of DFS Group, while improved, are still not substantial enough, said the Singapore Manual and Mercantile Workers' Union (SMMWU) yesterday.

Travel retailer DFS had faced criticism following its abrupt retrenchments last week, which involved staff at its Changi Airport and T Galleria shops, as well as its shared services centre at Chai Chee. It said the layoffs were made because of a challenging travel retail environment and losses.

Employees were initially given one week's pay per year of service, capped at 13 weeks.

The terms were then updated to two weeks' pay per year of service, capped at 26 weeks, which staff were told of on Wednesday.

But this amount is still "peanuts", said SMMWU secretary-general David Yeo yesterday.

"For someone who is 58 who has worked there for 20 years, finding a new job is not going to be easy, so I would expect more help for this group of people," he said.

SMMWU deputy secretary-general Elvin Lee said this could even be in the form of an ex gratia payment to fund their retraining to help them prepare for a new job.

According to a tripartite advisory on responsible retrenchment, companies are encouraged to pay retrenchment benefits of between two weeks and a month of salary per year of service, depending on the company's financial position and the industry norm. For unionised companies, the norm is one month's salary for each year of service.

Speaking to reporters at the union's office in Geylang, Mr Yeo said the union is deciding when to meet DFS. It served DFS a claim for recognition last week so that it can represent its workers in negotiations for remaining staff. It will also revisit the retrenchment package of those already asked to go, he said.

If the company does not agree to recognise it, the Commissioner of Labour can call for a secret ballot of workers on the matter.

Mr Lee said the union is in touch with more than 100 affected workers from the airport and another two representing a group from T Galleria in Scotts Road.

DFS did not respond when asked how many workers are affected by the retrenchment exercise across the different locations.

An employee from the finance department in Chai Chee said close to half of her 200-strong department were affected, and the layoffs were unexpected. Out of the blue, staff at the shared services centre were all asked to report to work at 9am one day last week, she recalled. As the day went on, some were told they were being retrenched.

"They came out from meetings one by one and told us 'it's my last day' or 'mine is next year'," said the employee, who asked not to be named. Some colleagues were very upset and broke down, she added. "It was pretty badly handled (by DFS)," she told The Straits Times yesterday.

Mr Yeo noted that the union considers companies' profitability and liquidity when negotiating for better retrenchment benefits.

DFS had said on Wednesday that it continues to employ almost 1,000 staff in Singapore.