In a statement, Managing Director Kuan Mun Leong explained that the company’s decision to retrench the workers – who were hired on a contract basis – was not solely based on the hike in the minimum wage or increased costs as reported.
“The headcount reduction exercise has resulted in a productivity improvement from 3.9 to 3.6 workers per million pieces of gloves.
“Moving forward, Hartalega will continue to grow and recruit more workers in line with our established expansion plans.”
Earlier, the Nikkei Asian Review (NAR) reported that Hartalega Holdings, the largest producer of synthetic rubber gloves in the world, said it had fired almost 600 people in a “cost management exercise”.
This figure, according to the NAR report, is close to 10 per cent of its headcount.
The report also quoted Kuan as stating that the workers who were laid off had helped it mitigate the increase in the minimum wage.
The company had also reduced costs by optimising energy consumption and redesigning its production line, but did not reveal its savings.
Earlier this month, the company announced a 10.4 per cent year-on-year decline in net profit in the second quarter due to stiffer competition and higher costs.