The pandemic is evidently taking its toll on different businesses around the world. Panasonic will shut down its Singapore refrigeration compressor manufacturing operations. The closure is due to the unbearable global business projection. It includes the prolonged business strategic evaluation of the refrigeration compressor business portfolio. An Economic Development Board (EDB) spokesman remarked that the company’s refrigeration compressor business unit has significantly declined.
The Japanese firm’s operation will stop by the end of September 2022 that will affect 700 employees. This cutback on employment represents around one-third of Panasonic Singapore’s total workforce. However, its research and development department will continue its Singapore operation. Likewise, it will stay as the corporation’s refrigeration compressor business headquarters.
“There are a total number of 700 employees who will be affected by this review process. The Panasonic group in Singapore will continue to have more than 1,400 employees across various business domains, including high-value manufacturing, R&D, and our Asia Pacific headquarters,” said the company.
Panasonic assured the affected employees of receiving their retrenchment benefits as indicated in the Collective Agreement. The United Workers of Electronics & Electrical Industries (UWEEI) confirmed its continuous collaboration with Panasonic Appliances Refrigeration Devices Singapore (PAPRDSG). It will guarantee dismissed workers to acquire the crucial assistance and support for fair treatment.
As a unionized company, Panasonic’s retrenchment benefits are one month’s salary for every year’s service. This makes it higher than industry norms of between two weeks to a month’s wage each year of service. However, it depends on the company’s financial standing and industry.
PAPRDSG will associate with other Panasonic group companies in Singapore to seek out potential re-employment. It depends on job availability and the employee’s qualification. Currently, it has roughly 760 employees, of which 12% are presently working at the Gul Road plant.
Integration of Compressor Manufacturing Operations
Panasonic will integrate the compressor manufacturing operation to its remaining facilities in Wuxi, China, and Melaka, Malaysia. The casting operation will also take place in Melaka.
The layoff will affect half of the Singaporean workers, while 13% are permanent residents. The first group of retrenched workers will have their last work on March 31, 2022. The second batch, on the other hand, is in September of the same year.
Employees aged 50 or older comprised 60% of the reduced workers. Those between 30 and 50 years old constitute 30% of the total percentage of laid-off staff. On September 23, those who work in the engineering process and production control received their notification for four separate 45-minute sessions.
Panasonic Asia Pacific’s establishment in Singapore in 1974 delivers to markets throughout Southeast Asia and the Pacific regions. It has over ten branch operations, which include an R&D center established in 1990. Research activities involve wireless network technologies and artificial intelligence. Other business division includes commercial equipment systems and factory solutions.
Singapore PM Remains Grateful Amid Panasonic Shutdown
Although saddened by Panasonic’s closure, Singapore Prime Minister Lee Hsien Loong remains thankful for the Japanese company’s belief in the country.
PM Lee said that Singapore, together with the Economic Development Board, greatly appreciates investors like Panasonic. Additionally, the country will keep on affiliating with the company to produce jobs and possibilities for Singaporeans.
He added that displaced workers would get support in finding new jobs. The United Workers of Electronics and Electrical Industries and National Trades Union Congress (NTUC) will help affected employees.
The firm’s refrigeration compressor establishment in 1972 produced and shipped 285 million compressors worldwide. A third of the compressors originated in Singapore, which accommodates the second-largest plant in the world.