H&M asks Singapore staff to reapply for jobs around Asia as part of restructuring

SINGAPORE: Staff across Swedish fashion retailer H&M's East Asia regional market – which includes Singapore – are being asked to reapply for roles, with those who are unsuccessful facing "mutual separation" in line with local employment laws.

It is not clear which markets and how many employees are affected. Based on H&M Group's latest annual report, it had 368 employees in Singapore last year across several brands including H&M, COS and & Other Stories.

Staff can reapply for 178 available roles, said three employees who spoke to CNA on condition of anonymity. So far, no one has been laid off as this process is ongoing, and the restructuring and staffing decisions will take effect by Jul 1.

Of the roles available, 80 are in H&M's Southeast Asia offices – mostly in Kuala Lumpur, Manila and Ho Chi Minh City, an employee said. Four of these roles, including legal functions, will be based in Singapore. 

A second employee told CNA that roles formerly in Singapore are being moved to Kuala Lumpur and Manila.

Staff were officially informed of H&M's plans to restructure, including moving its Southeast Asia headquarters from Singapore to Kuala Lumpur, on May 11. 

In the same announcement, H&M employees across East Asia were asked to take part in a staff "calibration" exercise by May 21, the employees told CNA.

This involves completing a survey and nominating themselves for two available roles. Contribution ratings and recent disciplinary records will be used to determine their possible placements in the company.

Employee interviews and evaluations will be scheduled until Jun 19, and they will get their results by mid-June.

The restructuring was also discussed at earlier town halls with the global teams, said one of the employees.

Since they are being asked to reapply and re-interview for similar roles in the organisation, the process feels "a bit too drawn out", said the employee, who spoke on condition of anonymity. 

"You essentially know that roles are being cut, but you don't know whether it's going to be you. And that uncertainty is probably causing more anxiety with employees."

This person plans to decide whether to relocate based on the details of the new compensation package if they land a new role.

The other countries where positions are available, such as Malaysia, Japan and South Korea, have higher tax rates than Singapore, the employee noted, adding that this may make any offer less attractive. 

"Whichever option you choose, you're either facing currency deflation or a higher tax rate."

H&M did not confirm the relocation and layoffs when responding to CNA's queries on May 12.

"We regularly review how we work to ensure our organisation remains flexible, efficient, and fast-moving," said the company.

"We are fully committed to supporting all of our colleagues in any organisational changes and will continue to fulfil our obligations according to local labour law requirements."

The company did not respond to further queries on May 18 about the staff "calibration" exercise.

UNION OFFERS HELP

All employers in Singapore are required to inform the Ministry of Manpower of any retrenchment within five working days after the affected employees are notified.

Retrenchment benefits are not required by law. A norm of two weeks to one month's salary per year of service is specified in a tripartite advisory, but it has no legal force.

Lawyer Terence Seah, a partner at Virtus Law, said that no conclusions about what an employee is or is not entitled to can be made from the term "mutual separation".

As Singapore law generally does not have mandatory retrenchment requirements, the employment contract forms the framework for a separation when there are layoffs, he said.

"Each employer will have to look at its own employment contract terms, and what policies and what obligations it has under contract law," said Mr Seah.

"Each company has to look at whether it has any binding rules in its contracts with its employees, as a starting point.

"Beyond that, if there is goodwill and parties are happy to agree on terms to part ways, then freedom of contract allows them to enter into an agreement to do so."

H&M Group is not unionised in Singapore, according to the National Trades Union Congress (NTUC).

Nonetheless, some employees may be members of the NTUC-affiliated Singapore Manual and Mercantile Workers' Union (SMMWU), said its secretary-general Andy Lim.

NTUC and SMMWU are ready to offer assistance and resources to help their members and workers transition to new job opportunities and provide financial support if needed, he added. 

"In the event of business restructuring affecting individual union members in non-unionised companies, NTUC's affiliated unions or associations will extend assistance to these individual members," said Mr Lim.

This includes connecting them to NTUC's Employment and Employability Institute (e2i), which provides job-matching services, career coaching and advice on skills upgrading.

"The SMMWU encourages companies, including non-unionised companies, to work with the union to provide better support for their workers during periods of transition," added Mr Lim.

Affected workers can contact SMMWU for support at 6294 2481 or email feedback [at] smmwu.org.sg.