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Oral Answer by Mr Lim Swee Say, Minister for Manpower, to Parliamentary Question on Unfair Dismissal

Employment practices

Notice Paper No. 519 Of 2016 For The Sitting On 06 February 2017

Question No. 929 For Oral Answer

MP: Assoc Prof Daniel Goh Pei Siong

To ask the Minister for Manpower (a) what constitutes due and fair process in terminating employees due to poor performance; (b) what recourse do employees have to access crucial evidence on performance held by employers to prove unfair dismissal; and (c) what are the penalties for employers who disguise retrenchment as termination due to poor performance.

Question No. 905 For Oral Answer

MP: Dr Tan Wu Meng

To ask the Minister for Manpower whether the Ministry can provide an update on investigations into the recent termination of multiple employees of Surbana Jurong.

Answer

  1. Employers who terminate employment contracts on the ground of poor performance have to be able to substantiate their claim of poor performance. The Tripartite Guidelines on Fair Employment Practices makes it clear that employers who wish to terminate the services of employees on the ground of poor performance are to apply relevant and objective performance criteria. The criteria should be made known to all employees. Employers should also keep records of their employee’s performance, and a decision to terminate the service of an employee should be based on documented poor performance. Where it involves a unionised employee, the union should also be consulted.  
  2. If the employee files an appeal of unfair dismissal to MOM, we will first mediate. Should mediation fail, we will conduct an inquiry and require the employer to show cause and produce evidence to justify the termination. This remedy is provided under the Employment Act, as well as the Industrial Relations Act for union members.
  3. If an employer is unable to substantiate his claim that the employee’s performance is poor, the employer may be ordered to reinstate the employee, or to provide compensation. If the employer does not comply with the order, he can be prosecuted.
  4. In the case of Surbana Jurong’s recent exercise to terminate the services of 54 employees, the company has acknowledged that the process could have been better managed. The management and unions have since reached an agreement on an ex-gratia payment, which in our view is a fair outcome for the affected employees.
  5. This episode serves as a good reminder to employers that termination exercises should be conducted in a responsible and sensitive manner.