Lazada apologises to FDAWU over retrenchments in Singapore

Lazada Singapore has extended an apology to the Food Drinks and Allied Workers Union (FDAWU) in the wake of the retrenchments it carried out last week, according to the National Trades and Union Congress (NTUC).

In a statement, the NTUC said its affiliate FDAWU and Lazada Singapore "have made some progress with regard to the recent retrenchment exercise" that the e-commerce firm carried out between January 3 and 5.

"FDAWU have accepted Lazada's apology for not consulting them prior to the retrenchment exercise. Both parties have agreed to work closely together and to put workers' interests at the forefront of their negotiations," the statement from the unions said.

The unions added that Lazada has provided assurance that they will "fully cooperate and provide any necessary information" to ensure that the retrenchments were carried out fairly.

"Lazada have also assured FDAWU that they will be consulted in advance for any future exercises," the statement said.

Lazada retrenchment

The apology comes after the NTUC and FDAWU issued a previous statement expressing disappointment over the news that Lazada retrenched a number of employees in Singapore without consulting the union.

CNBC reported that employees across Southeast Asia markets from all levels have been affected, with Singapore being the most impacted.

The retrenchments in Singapore have affected nearly 100 employees, involving mainly Professionals, Managers and Executives, according to the NTUC and FDAWU.

"We, too, are extremely disappointed in this move by Lazada. NTUC would like to reiterate that it is critical for companies to work with their union to ensure that a fair and equitable process was carried out to safeguard the interests of all workers, especially our Singaporean core," the NTUC said in a previous statement.

'Unsatisfactory' retrenchment benefits

Affected employees have been informed that they will receive two weeks' salary for every year of service, according to the FDAWU.

The union, however, said this was "unsatisfactory" and would negotiate further additional benefits.

"The Manpower Ministry will continue to facilitate these negotiations," the NTUC statement said.

A spokesperson from the Ministry of Manpower (MOM) said it has seen "good progress" in the discussions between Lazada and FDAWU last week, Channel News Asia reported.

"Lazada is working closely with MOM and the FDAWU to ensure that the restructuring exercise is held in a fair and responsible manner, including offering affected employees adequate support and appropriate retrenchment benefits in line with industry standards," the spokesperson told the news outlet.

Employers in Singapore are strongly encouraged to ensure transparency and consultation with unions in the wake of retrenchments, as outlined in the NTUC's Fair Retrenchment Framework and the Tripartite Advisory on Managing Excess Manpower and Responsible Retrenchment.

The latest data from Singapore's Labour Market Report revealed that retrenchments went up in the third quarter of 2023 as more organisations carried out reorganisation or restructuring activities.