Yuen Law’s Managing Director and Co-Head of Corporate, Samuel Yuen, joined host Daniel Martin on CNA938’s TalkBack to discuss the legal obligations employers owe employees approaching retirement age in Singapore, following an Employment Claims Tribunal decision awarding a 63-year-old employee $26,350 after his employment was terminated without notice.
Retirement age does not automatically end an employment contract
Reaching the statutory retirement age does not, on its own, bring an employment contract to an end. The employer cannot, under the Employment Act, the Retirement and Re-employment Act, or common law, simply terminate employment automatically upon retirement age. Employment must still be terminated in accordance with the contract, by giving notice or salary in lieu. In the tribunal case, the immediate termination was found to be a repudiatory breach of contract, and the employee was awarded damages equal to his contractual notice entitlement of two months.
Employers carry statutory re-employment obligations
Employers have a statutory obligation under the Retirement and Re-employment Act to offer re-employment, on one-year renewable terms, to eligible employees who reach retirement age, currently 64, until they reach the prescribed re-employment age, currently 69. This process follows a defined timeline:
- Six months before retirement: the employer must start formal consultation on re-employment options, job scope, and salary adjustments.
- Three months before retirement: a qualifying employee must then receive a written re-employment offer; an ineligible employee must instead receive three months’ written notice.
Where suitable re-employment cannot be provided
Where an employer cannot reasonably provide suitable re-employment, it must instead:
- Pay a one-off Employment Assistance Payment, a one-off payment equivalent to 3.5 months’ salary, subject to a minimum of $6,250 and maximum of $14,750, or
- The standard retrenchment severance package where this is specifically stated in the individual contract or union collective agreement.
The EAP is not damages, but a statutory payment intended to assist the employee while seeking new employment.
The tribunal’s decision underscores that employers face both contractual and statutory obligations as employees approach retirement age, and that failure to observe either, including failing to make a valid re-employment offer before the re-employment age deadline, can result in liability for damages, an Employment Assistance Payment, or both.
Listen to the full discussion on CNA938’s TalkBack.
Read the ECT decision in JIS v JIT [2026] SGECT 5.
More about Samuel Yuen.