Guidelines on how to manage excess manpower and retrench employees have been revised for the first time since 2009, according to a statement from the tripartite partners yesterday.
The new recommendations include shortening the length of service of those eligible for retrenchment from three to two years, as well as who to let go.
Instead of laying off workers on such grounds as age or family responsibility, the partners ask employers to consider whether the workers can contribute to the company's future business needs.
Another major change is how to retrench workers responsibly, including which agencies to inform and when to do so.
Bosses are also urged to inform workers of the layoff as early as possible, explain the reasons for it and outline how it will be carried out.
The tripartite partners are the Ministry of Manpower (MOM), Singapore National Employers Federation (SNEF) and National Trades Union Congress (NTUC). The guidelines, introduced in 2008, were first changed in 2009, amid an economic downturn. Yesterday, the partners noted the current slowing economy and advised employers to retrench only as a last resort and to use the downtime to upgrade workers' skills or redesign jobs.
"As local workforce growth is expected to be only 1 per cent per annum until 2020, we urge employers to take a longer-term view of their manpower needs," said SNEF executive director Koh Juan Kiat.
But if they must retrench, companies are advised to inform MOM and, where relevant, the Tripartite Alliance for Fair and Progressive Employment Practices.
They are asked to do so as early as possible so that local employees can be helped to find new jobs or receive relevant training.
Unionised companies are urged to consult their unions early, with the norm being a month before the workers are told.
Labour MP Patrick Tay, who also chairs the Government Parliamentary Committee for Manpower, welcomed the changes but was worried how non-unionised companies would handle a retrenchment.
In a Facebook post, he reminded companies that there are many alternatives to a layoff, such as a shorter work week and adopting a flexible wage system.
If retrenchment is the only recourse, it should be done "fairly, responsibly and sensitively". Notice should not be given during festive seasons like Chinese New Year and Hari Raya, he said.
This article was first published on May 25, 2016.
Get a copy of The Straits Times or go to straitstimes.com for more stories.