True Group says it will settle staff wages in Malaysia

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PETALING JAYA: The True Group fitness and wellness chain has given an assurance that it will settle outstanding payments to 70 staff members in Malaysia after it ceased its operations in the country last Saturday.

According to The Star Online, a spokesman for the Singapore-based company said its accounts were “held back” following the announcement of the closure on its website on June 9.

“That has been resolved and the salaries and commissions have been sent to all staff and will be released on June 19,” the spokesman was quoted as saying today.

“We express our sympathies about the matter that has happened. We tried to exhaust all other options but there were no alternatives available except to consolidate the business in Malaysia.”

He was quoted as saying that True Fitness Malaysia had been incurring operating losses since the goods and services tax (GST) was implemented in May 2015.

“The losses for 2015 were RM9.15 million and we lost RM7.26 million in 2016.”

He said the businesses in Singapore, Taiwan and China had assisted in subsidising losses in Malaysia over the past year.

The spokesman also said discussions with CHi Fitness were ongoing on the issue of membership transfer.

The shuttering of the True Fitness and True Spa outlets in Kuala Lumpur followed the closure of all True Fitness, True Spa and True ‘Est outlets in Bangkok on June 9.

Members in both Malaysia and Thailand have responded with anxiety over whether they will get back the fees paid.

The Star also reported that the closures were related to a franchise agreement between True Group and Chinese investor Tongfang Kontafarma Holdings Ltd.

It said the transaction was worth US$36.7 million (RM156.4 million) and completed on May 29.

Under the deal, Tongfang will acquire 51% of True Group’s Singapore and China businesses and a 29% share of its Taiwan businesses.

Tongfang informed the Hong Kong Stock Exchange on May 7 that True Group CEO Patrick Wee had agreed to shut down operations in Thailand and Malaysia by Dec 31.

The Star said an announcement on irasia.com, an investor relations portal, also stated that if Wee failed to do so, he and his company’s subsidiaries would be liable for franchise fees.

Earlier today, some 30 True Fitness staff lodged complaints at the Subang Jaya labour department here.

The main complaint was that the company had not paid most of the staff their salaries. Commissions, dating back four months, were also owed to most of them.

Domestic Trade, Co-operatives and Consumerism Minister Hamzah Zainuddin has urged disgruntled members of the fitness club to submit complaints and claims to the Consumer Claims Tribunal.

“The tribunal can handle claims up to RM25,000 for each person,” he said.

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