More payments for laid-off Lazada employees; some receive 2 additional weeks of pay per year of service

SINGAPORE – After months of waiting, former employees of e-commerce giant Lazada, who were laid off in January, have finally been told how much more in payments they will receive.

Some of them will receive an additional two weeks of pay per year of service, to be paid in about two weeks, while others will receive only “training support” of $1,200, to be paid in August, according to several former employees who spoke with The Straits Times on condition of anonymity.

The former employees were from Lazada Singapore and Lazada Southeast Asia. They had initially received two weeks of pay per year of service, which is below industry norms.

In response to questions, Julie Cheong, president of the Food, Beverage and Allied Workers Union (FDAWU), which had negotiated with Lazada for the additional benefits, said the payments take into account employees’ length of service at Lazada, their job qualifications and the validity of your membership in FDAWU.

“This implies that a uniform payment is not applicable. No further details related to the payment can be shared due to a confidentiality clause in an agreement signed between FDAWU and Lazada Singapore,” he said on May 23.

National Trade Union Congress (NTUC) general secretary Ng Chee Meng said in a Facebook post on May 21 that the union was closing matters with affected eligible union members.

“They have engaged directly with affected members, collected and verified all necessary information and determined the optimal distribution approach to union members. The FDAWU has done everything possible to defend the interests of its members during this period.”

Lazada did not respond to ST’s request for comment.

In January, Lazada laid off an undisclosed number of its Singapore workforce without informing the union, even though these workers were unionized. Sources said at the time that the company planned to cut 25 to 50 percent of its workforce in Southeast Asia, while media reports speculated that at least 100 people were laid off in Singapore. The cuts spanned several departments of the company, as well as its regional offices in countries such as Malaysia, Indonesia and Vietnam.

Laid-off workers were offered two weeks’ pay for each year of service. The FDAWU then said it was negotiating with Lazada to get better benefits for them, with the Ministry of Manpower facilitating the talks.

On February 4, NTUC, FDAWU and Lazada said in a joint statement that they had reached an amicable agreement. Ng separately said eligible union members would have “an enhanced package that would reflect union standards.” Typically, this refers to one month’s salary per year of service.

A former manager, who worked at Lazada Singapore for less than five years, told ST that she was contacted last week and asked to choose a time on May 20 to meet with the union. She attended a group briefing and then met with a union representative who explained her additional benefits: two weeks of pay per year of service, which she believes is the basic amount employees deserve.

“Although there are no MOM guidelines that state we should receive one month’s pay per year of service, it is common in this industry to receive that amount or even more,” he said.

“At least the wait is over and the result is satisfactory,” he added.

Meanwhile, a former Lazada Southeast Asia department head, who had worked for less than three years, said he received a call on May 21 and was told he would receive $1,200 as “training support.” He had previously earned more than $10,000 a month in the company.

He said he was not happy with the payment after months of waiting. “There was no explanation as to who was eligible for the enhanced benefits package and why,” he added.

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