StarHub sends out retrenchment letters to some 300 staff members, offering compensation beyond market value

Following StarHub’s announcement earlier this month regarding the impending retrenchment of some of its staff members, the local telecommunications giant began laying off some of its 300 full-time and contract workers on Monday (29 Oct).

Speaking to TODAY, a StarHub employee who did not wish to be named revealed that the staff members who had received the pink slip were those working in the following departments:

  • information systems;
  • engineering;
  • marketing and commercial; and
  • consumer departments.

The same staff member added that many of them were senior managers with 15 years of service at the telco.

Workers who were part of the retrenchment exercise, according to TODAY’s sources, will receive:

  • a month’s pay for each year of service, pro-rated annual wage supplement — commonly known as the 13th month bonus;
  • a variable bonus based on the company’s financial performance, which will be paid out in March next year; and
  • six months of medical and insurance benefits from the termination of their employment contract.

StarHub, in response to TODAY’s queries — while declining to confirm the specifics of its compensation package, citing confidentiality reasons — assured that its “overall package is more generous versus market practice”.

“As a responsible employer, we are following the manpower guidelines laid down by the Ministry of Manpower [MOM] closely,” said StarHub, adding: “We intend to treat our employees fairly in recognising their past contributions, with sensitivity and respect.”

MOM’s guidelines stipulate that companies are encouraged to pay retrenchment benefits of between two weeks and a month’s salary per year of service, depending on the company’s finances and the industry on which the company is based.

Unionised companies are urged to abide by the standard of one month’s salary for each year of service.

Some staff members were “well-prepared,” aware of the announcement made earlier this month

A staff who was included in the retrenchment exercise said he was “not surprised” by the layoffs, saying: “Since news of this spread out for so long, almost one month, I think all of us are so-called well-prepared.”

He added that the retrenchment exercise did not become a source of alarm for him, as his only child is currently employed, and thus he is not worried about becoming the breadwinner of the family.

The staff member – who is in his 50s – also highlighted that the retrenchment package was “not too bad”, and that he perceived the layoff as “early retirement”.

Others taken aback by the retrenchment exercise; some staff members ambivalently and anxiously awaiting their fate at the telco

Another StarHub staff member illustrated the “drama” that took place during the first batch of the retrenchment exercise, which was carried out on Monday. The employee described to TODAY that some of the affected staff members wept as they did not anticipate that they would be retrenched.

One employee said that he has begun making preparations in the event that he will also be retrenched by producing handover notes and documents ahead of the announcement in his department today (1 Nov).

Another StarHub employee said that those who were laid off were immediately put on one- or two-month “gardening leave,” for which they will be compensated.

One StarHub employee revealed that some of his colleagues have even requested to be part of the retrenchment exercise, following news of the supposedly lucrative retrenchment benefits package, as they are afraid that any subsequent layoffs would not offer similar benefits.

“With so many competitors in the market, and TPG Telecom (fourth telco) coming in, the pie is only this big.

You have so many service providers but the pie is the same,” he said.

Heavier workloads and the lack of systematic handovers have resulted in heightened stress and anxiety for current staff members, many of whom are anticipating more challenging times ahead, particularly following the recent layoffs.

“Life is going to be hell for me for the next few months,” lamented a StarHub employee.

Retrenchment exercise part of StarHub’s “operational efficiency programme” in the face of “intense competitive ferocity” in the telecommunications market: StarHub CEO

Previously, in its press release earlier this month, StarHub reasoned that the retrenchment of some “300 full-time employees” serves as a part of its “operational efficiency programme”.

The “strategic review process,” stated the company, aims to increase “productivity” and “speed in decision making,” as well as reducing “operating expenditure.

The StarHub staff members affected by the move are those in “non-customer facing functions.”

Chief Executive Officer of StarHub Mr Peter Kaliaropoulos said: “The intense competitive ferocity right across the market, new entrants, lower voice revenues, thinning margins for fixed broadband services, high content costs for Pay TV operations and high market penetration for mobile and fixed services, has necessitated efficiency optimisation initiatives as part of the strategic transformation plan.”

The local telecommunications giant reassured that it will “work closely with its affiliated companies, the Singapore Industrial and Services Employees’ Union (SISEU), NTUC’s e2i (Employment and Employability Institute), and government agencies such as Workforce Singapore to identify suitable roles for impacted employees.”

Additionally, StarHub will be providing support in terms of “comprehensive career transition and outplacement counselling,” which will encompass coaching and skills upgrading programmes.

“We wish to recognise the extensive contribution that our impacted employees have made to the company’s past development and growth. Such decisions are never taken lightly.

“I am very aware of the impact on all our employees, and we are making every effort to support those impacted through this challenging transition.

“The redundancies are not an individual performance issue but one of strategic realignment of StarHub. We have been extremely fortunate to have many competent people in our team but some positions are not sustainable given the current industry pressures,” said Mr Kaliaropoulos.

However, Mr Kaliaropoulous added that in spite of this retrenchment exercise involving non-customer facing staff, “StarHub will continue to grow its workforce in areas such as cyber security, home and enterprise solutions and customer care.”

For just US$7.50 a month, sign up as a subscriber on Patreon (and enjoy ads-free experience on our site) to support our mission to transform TOC into an alternative mainstream press in Singapore.
Notify of
Inline Feedbacks
View all comments

Trending posts

November 2018