ST Engineering has offered some of its employees the option of “early release” from their jobs, but stressed that it was not engaging in a retrenchment exercise.
Responding to queries from The Straits Times, a company spokesman said: “During the third quarter, we offered select employees… to opt for early release through a mutually agreed separation scheme, in the light of the sustained impact of Covid-19 on some parts of our business.”
ST Engineering, which employs about 23,000 people worldwide, did not say how many employees were offered the scheme or how many accepted the offer.
“That was not a retrenchment exercise. Employees who did not accept the scheme were redeployed,” the spokesman added.
She said the group was, and continues to be, significantly impacted by Covid-19 due to a drop in customer demand, supply chain challenges and workforce disruptions.
To stay viable as a business, ST Engineering has been implementing cost-saving measures to mitigate the impact of Covid-19, the spokesman added. These measures include deferment of discretionary capital expenditure, tightening of operating expenditure including staff and staff-related expenses, cuts in promotional expenses related to trade exhibitions and suspension of business travel.
On Wednesday, the mainboard-listed company said in a third-quarter business update that it expects full-year revenue to be around 10 per cent lower for FY2020 than in FY2019. This followed its announcement on Tuesday that the company will be restructured into two main clusters from January next year – commercial, and defence and public security.
It is currently organised according to sectors: aerospace, electronics, land systems and marine.
The spokesman yesterday also stressed that the group’s reorganisation is not a cost rationalisation exercise, but a move to better position the company for global growth and success.
Several companies badly affected by the pandemic have also offered their staff early release or retirement packages.
Singapore Airlines (SIA), which was operating at only 7 per cent of its scheduled capacity, introduced a voluntary retirement scheme for its cabin crew in August. A month later, SIA Group announced about 2,400 staff would be retrenched.
During the third quarter, we offered select employees… to opt for early release through a mutually agreed separation scheme, in the light of the sustained impact of Covid-19 on some parts of our business.
Last month, employers were given the green light by the National Wages Council to implement temporary wage cuts if it means saving jobs.
Source: Read Full Article