Flash Coffee denies staff on strike after closing all 11 S'pore outlets, still owes them wages

Tay Hong Yi
The Straits Times
Oct 13, 2023

Flash Coffee, a start-up known for selling coffee through tech-enabled kiosks and cafes, on Friday denied reports of a “strike” by staff, and said it shut all 11 of its outlets in Singapore on Thursday.

But its workers here are owed salaries, Central Provident Fund contributions and encashment for unused leave, said a union representing food and beverage industry employees.

Workers were told at a meeting on Thursday that the company had been placed on provisional liquidation and their services were terminated effective that day, said Food, Drinks and Allied Workers Union (FDAWU) president Julie Cheong on Friday, in response to media queries.

Just two days before, they had been told all 11 outlets would be closed effective Wednesday.

“Salaries owed comprise the balance of 75 per cent of workers’ September salaries, as well as for the work done up till Oct 12, along with encashment of remaining leave days,” said Ms Cheong.

The union, which found out on Friday about allegations of owed salaries made by Flash Coffee employees, will be assisting affected members with salary-related claims.

This comes after a video showing Flash Coffee’s shuttered Jurong Point outlet began circulating on TikTok on Thursday.

The video showed a poster apparently put up by the outlet’s staff, stating that they were “on strike” due to “several late salary payouts”.

@resonancereviews Flash coffee are closed!? #flashcoffee #riot #delayed #momoneynowork #baristalife ♬ Oh no no no No - oppa

Acknowledging online reports about the “strike” at the Jurong Point outlet, Ms Cheong said the union spoke to affected employees, some of whom are union members, to provide help and understand the situation.

Those the union spoke to reported “no explicit plans to put up any coordinated action” after they were informed of the company’s situation, she said.

The union will also provide job assistance, tapping its network of unionised companies and the wider labour movement network, including the National Trades Union Congress’ Employment and Employability Institute, she said.

Ms Cheong also said workers whom the union already engaged have been connected with immediate job vacancies in the services sector.

Flash Coffee is not unionised here.

A former Flash Coffee employee who left the company a few months ago and spoke to ST on condition of anonymity said that salary payouts were previously delayed in February, before reverting to being given out on schedule.

When asked, a Flash Coffee spokesman denied that staff here went on strike.

“We ceased operations at our 11 stores and consequently, our baristas are not required to report to work,” he said on Friday.

He also said most staff in the firm’s Singapore head office have been offered roles in other markets, or with its regional team.

“Additionally, we are actively trying to connect our baristas with opportunities in other coffee chains.”

The spokesman said Flash Coffee has about 200 outlets globally, and decided to cease operations here to “further consolidate our future efforts and to double down on our most promising markets”.

The Singapore unit, which listed Flash Coffee co-founders David Brunier and Sebastian Hannecker as its directors, filed notice on Thursday that it is unable to continue its business due to liabilities.

It filed for a voluntary winding-up, and was placed under provisional liquidation. BDO Advisory has been appointed as the company’s liquidator.

Flash Coffee’s spokesman said on Friday that most of the brand’s markets have displayed great traction and future growth potential, with some of these markets set to break even in terms of earnings before interest, taxes, depreciation and amortisation in the coming months.

The chain operates in Indonesia, Thailand, Hong Kong and South Korea, according to a May 2023 statement it issued after raising US$50 million (S$68.5 million) in an extended Series B round of venture funding.

Mr Brunier, who is chief executive of Flash Coffee, said then that all of its stores in Indonesia were profitable.

Investment firm White Star Capital and foodpanda parent Delivery Hero were among the investors that took part in that funding round.

On Friday, the coffee chain’s spokesman said: “We remain firm in our mission to serve up high-quality coffee across Asia, and likely some additional markets in the medium term, and stay committed to scaling our business sustainably in the long term.”

He added: “We also extend our deepest gratitude to our dedicated customers in Singapore.”

Flash Coffee did not address ST’s queries on unpaid and late wages in its response.

Affected union members and employees can reach FDAWU on 6737-6088 during working hours, or e-mail fdawu@ntuc.org.sg for assistance.

• Additional Reporting by Timothy Goh.