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DFS offers retrenched employees better severance deal following talks with union

DFS offers retrenched employees better severance deal following talks with union

Last month, travel retailer DFS Group also laid off about 60 workers, following an announcement by the Hong Kong-based company that it was scaling back its operations in Singapore. (Photo: TODAY/Low Youjin)

SINGAPORE: Retrenched DFS Group employees were offered better severance packages on Wednesday (Nov 6) following discussions with the Singapore Manual and Mercantile Workers’ Union (SMMWU).

The retrenched workers will now receive one month's salary for each year of service, capped at 25 years, said a DFS Group spokesman in a statement. This is similar to what other unionised companies have offered here.

According to affected employees who met with HR staff on Wednesday, payouts will be made at the end of November.

These new terms come after two rounds of revisions of the severance package. 

The original package offered, when about 60 people were retrenched on Sep 26, was two weeks’ salary for each year of service, capped at 13 weeks of pay. The cap was later upped to 13 years, or the equivalent of 26 weeks’ pay, before the current deal was negotiated.

Affected employees were invited to meet with HR staff on Wednesday, Nov 6.

A DFS Group spokeswoman said the company has had "several positive meetings" with the SMMWU since early October.

READ: Improved DFS retrenchment package 'still off the mark': SMMWU sec-gen

READ: DFS offers retrenched employees better severance deal, but some say it's not enough

It is committed to carrying out the retrenchment exercise in a "fair and sensitive manner", following feedback and concerns from their employees as well as input from the SMMWU, she said.

“We sincerely thank all affected staff for their past service to DFS. We have increased the severance payout to all affected staff to one month’s salary for each year of service, capped at 25 years."

The spokeswoman also said that DFS Group will continue to work with tripartite partners and outplacement agencies to support affected workers.

The LVMH-owned company met with affected employees at its Chai Chee office on Wednesday to announce the new severance package terms and will be meeting employees on Thursday as well. 


Affected employees CNA spoke to said they were satisfied with the new terms. 

"All of us are elated, it’s kind of a victory for us," said one former employee, who had worked with DFS Group for 14 years before being retrenched.

An ex-employee, who worked for DFS Group for about 20 years, said: “I think it’s way more fair to us. They did what they should have done from the beginning.”

The employee told CNA that she has been looking for a job since the retrenchment exercise, but has had no luck.

"Because of our age and current resume experience, it’s a bit difficult, and the job market is tough at the end of the year. This new package is a bit of comfort ... I will have something to tide me over," she added.

Another former employee, who has worked for DFS Group for about 30 years, commended DFS Group for giving out long service awards to affected employees who would’ve worked 25, 30, 35 or 40 years this or next year, along with the retrenchment packages.

READ: Lotte Duty Free to take over DFS liquor, tobacco stores at Changi Airport

Affected employees also told CNA that about 30 of them met DFS Group’s Chief Financial Officer Zac Coughlin in mid-October. 

“He apologised and took personal responsibility for how the retrenchment was carried out on Sep 26,” said an employee who was present at the meeting. 

“He also mentioned that he didn't expect that the American way of retrenching staff was not appropriate in Singapore's context. He said DFS will need to rebuild the broken trust and image."


DFS Group announced in August that it would not retain its duty-free liquor and tobacco concession at Changi Airport when the lease expires in June 2020.

It had previously said that about 500 people were employed at DFS's liquor and tobacco duty-free outlets at Changi Airport and that staff members would be offered options regarding their employment, which include deployment to other DFS concessions and working for the new operator.

South Korea’s Lotte Duty Free announced on Oct 24 that it will be taking over the liquor and tobacco stores at Changi Airport.

SMMWU secretary-general David Yeo told CNA that the union will be helping affected employees secure positions with Lotte.

In response to CNA queries, a Lotte spokesman said that he could not confirm whether they will be hiring former DFS Group employees in need of a job.

“One thing we can clarify is that we are definitely willing to consider hiring those who have the relevant expertise. We believe that Lotte Duty Free and Changi Airport Group are on the same page regarding this matter," he said. 

“We are well aware that the employment is the very first thing to care for in this transition process.” 

Source: CNA/hw(hm)


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