KUCHING: Employers that have been hit extremely hard by the Covid-19 pandemic and forced to resort to retrenchment have been reminded that they must give notices first and pay the affected employees all forms of compensation or termination benefits.
Sarawak Labour Department director Awang Raduan Awang Omar stressed that such compensation or termination benefits are as stipulated under the Labour Ordinance (Sarawak Cap 76).
“Employers in the state need to understand the retrenchment process so that they can do it in an orderly manner in accordance with the labour laws,” he said in the statement.
He disclosed that the Sarawak Labour Department had received 332 notices from employers who wanted to retrench their employees last year.
“Labour statistics for Jan to Dec 2020 show that Kuching district recorded the highest number of employers (162) that laid off their workers.
“A total of 3,381 workers were retrenched from Jan to Dec 2020 in Kuching district. The second highest recorded were 125 employers in Miri with a total of 2,538 workers terminated,” he added.
There are no retrenchment notices received from Serian, Sarikei, Kapit and Bakun districts during the period.
Awang stated that aside from retrenchment, employers tended to reduce the salaries of their employees.
“A total of 3,765 local workers had their salaries deducted by 166 employers in various districts.
“Other than salary reductions, 27 employers implemented voluntary separation schemes involving 315 local workers, while five employers implemented temporary lay-offs involving 89 local workers,” he said.
As of Dec 2020, a total of RM52.7 million in compensation has been paid by employers to their employees.
“This amount is the largest retrenchment compensation recorded in the history of the department. Among the economic sectors affected by the implemented layoffs are hotels and food service sectors, retail and sales sectors, construction, manufacturing, and mining (oil and gas).
“A total of 4,834 local employees in the said sectors were affected by retrenchment implemented by 216 employers,” he said.
Awang also mentioned that several factors have been identified as the causes of retrenchment.
“Among the main ones are unstable and critical financial problems. The worst pressure experienced by these businesses is the outbreak of the Covid-19 pandemic,” he said.
