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DFS improves retrenchment package after its first two offers were deemed too low by former employees

SINGAPORE — After several rounds of negotiations, travel retailer DFS has offered new severance packages to its retrenched employees, TODAY has learnt.

Employees retrenched by DFS, which runs duty-free stores, were upset with the initial compensation payout offered by the company.

Employees retrenched by DFS, which runs duty-free stores, were upset with the initial compensation payout offered by the company.

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SINGAPORE — After several rounds of negotiations, travel retailer DFS has offered new severance packages to its retrenched employees, TODAY has learnt.

In a letter to retrenched staff members which was seen by TODAY, it was stated that they will now be receiving one month's salary for every year of service, capped at 25 years.

This was also confirmed by several former DFS employees who spoke to TODAY. 

This revised package comes after the first two were rejected by the staff members.

Those involved in the retrenchment exercise received a message on Tuesday (Nov 5), asking them to head down to DFS' office in Chai Chee to discuss updates to the severance terms.

Some of them will be meeting with their former employer on Wednesday, and others on Thursday.

One of them, Ms Lily Teo, who has been working with the travel retailer for 31 years, told TODAY that she was thankful for the improved severance package. 

The higher payout would help her tide through this period while she looks for another job. 

The 54-year-old said: “Go for job interview, also need to travel and need to eat… Now they say hard to find work because the job market is very soft. So I thought I can work part-time first until Chinese New Year, then I will find a permanent position.” 

In a statement on Wednesday, a spokesperson from DFS said that it is “committed to carry out (the retrenchment) exercise in a fair and sensitive manner”. 

This comes after getting feedback from staff members and input from the Singapore Manual and Mercantile Workers’ Union.

In addition to the revised packages, DFS said that it will “continue to work closely with our tripartite partners and external outplacement agencies to provide support to affected staff in their transition”. 

The company also said that it had several “positive meetings” with the union and look forward to further dialogues together to promote “good industrial relations for our mutual benefit and that of our staff”.

There was an outcry earlier from the retrenched employees, who were upset with the initial payout being offered and the unceremonious way they were informed of their redundancy and made to leave immediately.  

The company had initially offered the retrenched employees one week’s pay for each year of service, capped at 13 years of service — below the minimum compensation stipulated in the Ministry of Manpower's guidelines.

Manpower Minister Josephine Teo had said at the time that DFS "could have better handled" the retrenchment exercise, adding that the Tripartite Alliance for Fair and Progressive Employment Practices (Tafep) had stepped in to engage the company. 

DFS on Oct 2 revised the retrenchment payoutss to two weeks of salary for each year of service, capped at 13 years of service, but former employees felt that the offer was insincere.

The company said back in August that 500 employees would be affected by its decision to close its tobacco and liquor stores at Changi Airport.

A month later, reports emerged that 60-odd employees who were retrenched from its T Galleria outlet on Scotts Road.

Another 100 from its finance department located at its shared services centre at Chai Chee have also received their retrenchment notice, though the bulk of them would be serving their last day in June next year.

In response to TODAY's queries, a Tafep spokesman said on Friday that it was happy to learn that DFS has improved on the retrenchment package and extended it to all affected employees.

"This is a good outcome," the spokesman said. "Tafep is of the view that DFS could have handled the retrenchment exercise better at the outset. They could have avoided the confusion and uncertainty generated by the delay in arriving at the final retrenchment package."

The spokesman reiterated that employers that have to lay off staff "should do so in a responsible and sensitive way" and abide by the tripartite advisory on retrenchment, including the payment of retrenchment benefits. 

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