| Yawning
Bread. 17 November 2008
Screwed by the impotent
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Lim Swee Say, the Secretary-General of the National Trades Union Congress (NTUC) and cabinet minister, virtually accused DBS Bank of disrespect when they laid off hundreds of staff, giving his union empire just 3 days' notice. "There was no prior consultation with the DBS staff union. There was no exploration with the union on other cost reduction alternatives," the government-controlled Straits Times, another sister-in-law, quoted him as saying. [1] DBS staff union president Nora Kang said the usual practice was one of management giving unions a month's advance notice of mass layoffs. That lack of communication, Lim added, has weakened the trust between bank management and the union. What he called "trust", I'm sure many Singaporeans would be forgiven if they called incestuous backroom deals. Workers' unions in Singapore have not had autonomy since they were captured by the ruling People's Action Party in 1960s. DBS announced its retrenchment plan after reporting that its third-quarter results showed net profit for the quarter 38 percent down from the same period 2007.
A total of 900 staff, making up 6 per cent of the bank's 15,000-strong workforce spread over 16 countries, would be let go. These 900 would come mostly from its Singapore and Hong Kong operations. But could DBS Bank negotiate with the NTUC? Should they? I think there are good reasons why the bank saw the need to act as they did. Firstly, retrenchment is a demoralising exercise. Good management practice is to do it as quickly as possible, and not to drag out the process. The more it is dragged out, the longer employees are left worrying whether they will be affected. Morale and productivity suffers. In contrast, when it is quick and sharp, those who keep their jobs will know that they are safe and can get back to focussing on their work. The union's idea to spread the pain across the board, e.g. through salary reductions, can be a good idea, but it also has a downside for the company. Good employees who feel they can command better salaries elsewhere will quit, leaving mediocre employees in the bank's workforce. That cannot be in the best interest of the company. Retrenchment, on the other hand, allows management the freedom to prune off the poor performers. A more cogent reason why it is not easy for DBS Bank to negotiate with NTUC is that NTUC does not really represent a cross-section of the bank's employees, as the DBS Group operates across many countries. It has 34 branches in Indonesia, 40 in Taiwan and about 13 in China. While Singapore is still its main market, in recent years, growth has mainly come from other areas. For 2007, the geographical split of its income is as follows:
Can DBS afford to preserve jobs in Singapore as Lim Swee Say wants, while laying off staff in other markets? It won't make sense. It would also create a public relations disaster for the group. NTUC's impotence is a symptom of structural changes to the global economy. DBS is evolving into a multinational company. It has to, in order to remain relevant. Its stakeholders are spread across many countries. It needs public goodwill in areas outside Singapore. Unions, on the other hand, are still stuck in a pre-World War II mindset, organising themselves within national boundaries only. One rarely hears of unions recruiting members in other countries. This misfit between unions' span and corporations' will increasingly deprive the former of negotiating power. Imagine if there was a union representing all DBS staff across all countries, and with the freedom to call a strike if need be. DBS management would have to deal with them. But this, of course, is a pipe dream. Or maybe not. Nothing stops unions in different countries from starting a process of co-ordinating their actions and negotiating stances with each other and this can gradually evolve into multinational unions to match the span of corporations. All very nice in theory, but in the case of the NTUC, there is a unique problem. Would unions in other countries even want to be seen talking to a government-controlled entity like the NTUC? Would they not hold their noses in disgust? How can we afford to be seen allying ourselves with an imposter doing the bidding of an authoritarian government? they'd say. On this side too, would NTUC and the Singapore government even be able to contemplate a future where workers are part of multinational unions? Our government is wedded to the idea that they should control the unions, and so long as this is non-negotiable, can we even begin moving down the road of multinational unions? But if things stay as they are, won't the NTUC lose all influence altogether, as more and more companies go global? So, between the impossibility of this and the impossibility of that,
the Singapore worker is well and truly screwed. © Yawning Bread
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Footnotes
Addenda None
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A somewhat surreal story emerged last week. Our
government-controlled trade union federation blasted a government-linked company for
retrenching workers without consulting it. The whole thing seemed awfully
like a catfight between sisters-in-law.
