Honestbee retrenches 80% of staff, delays payment of salaries and CPF contributions

SINGAPORE - Struggling start-up Honestbee has retrenched about 80 per cent of its staff, in the wake of the temporary closure of its grocery store Habitat.

Employees have also been told that payment of their salaries and Central Provident Fund (CPF) contributions for the month of February will be delayed "until further funding can be secured".

In a statement on Tuesday (March 10), a spokesman for the company said that the cuts were made, as "the company does not foresee operating Habitat (at) its full strength over the next few weeks".

The start-up closed Habitat temporarily from Feb 10, citing the coronavirus outbreak and a reduction in the supermarket's walk-in traffic.

The majority of the 100-odd employees made redundant, out of Honestbee's overall headcount of 130 in Singapore, were "operational staff in culinary, service, retail and warehousing" at Habitat, the spokesman added.

The temporary closure of Habitat has impacted the firm's revenues, which led to the job cuts and delayed payment of salaries, the spokesman said.

In response to queries about how the terminated employees will be paid, Honestbee said the closure "has made it difficult for the company to commit on payment terms until further funding can be secured", but added that it has "no intention of shortchanging its employees".

The Business Times reported that some of Honestbee's foreign employees were notified that their work passes had been cancelled by the Ministry of Manpower (MOM) before they were informed by the start-up about their retrenchment.

These employees' work passes were cancelled in tandem with their retrenchment, the firm told BT.

One management staff member was also "voluntarily made redundant", the paper reported.

It is not the first time the start-up has been late in paying its employees, having owed more than 200 of its former employees around $1 million in salaries and CPF contributions previously.

Those payments were completed at the start of February, an MOM spokesman confirmed in an earlier statement.

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The Tripartite Alliance for Dispute Management had previously received claims from more than 60 of the start-up's former employees for non-payment of salaries. The Straits Times has contacted MOM for further information.

The embattled start-up, which is currently under court protection from its creditors which it owes about US$230 million (S$319 million), moved out of its former Delta House headquarters into an Upper East Coast Road shophouse unit in February.

According to BT, the firm has moved kitchen equipment and furniture to the shophouse unit, and Honestbee intends to set up a food and beverage outlet.

This article was first published in The Straits Times. Permission required for reproduction.