Yahoo Finance What Is The Difference Between Retirement Age And Re-Employment Age In Singapore?
Earlier this week, parliament passed the act to extend the re-employment age from 65 to 67. This will apply to all Singaporeans and permanent residents who turn 65 from July 2017 onwards.
As with most announcements pertaining to retirement, the change gathered quite a bit of discussion. Many people including politicians and experts have differing opinions about it and what else needs to be done.
With the topic gaining attention, we thought it would be appropriate to discuss some of the possible misconceptions that people have regarding the re-employment age.
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Retirement Age (62) Is Different From Re-Employment Age (Now 67, Previously 65)
The first thing to know is that the official retirement age in Singapore is different from the re-employment age.
Retirement Age, 62
The official retirement age in Singapore is 62. What that means is that your employers cannot ask you to retire before that age.
As with employment at any age, your employers can always sack you for poor performance, or retrench you if the company needs to shed headcount. However, dismissing an employee because of age-related reason is not allowed and considered discriminatory. Employees who feel they have been laid off because of their age can inform the Ministry Of Manpower (MOM) if they feel their employment have been unfairly terminated.
Re-Employment Age, Till 67
At age 62, Workers would have reached 62 can officially retire in Singapore. However, those who want to continue working can seek for re-employment with their existing employer.
Employers must offer re-employment to eligible employees who want to continue working up to the age of 67 within their company. If they are unable to do so, they may transfer them to their subsidiaries or another company, with the consent of their workers.
It’s worth noting the definition of “eligible employees”. The screenshot below is taken from MOM.
Source: MOM
Simply put, if you are healthy and have performed well previously, your employer has to offer you a re-employment contract if you want to continue working.
Your Employment Contract
Probably the most important area apart from the eligibility criteria, it’s important to know that the re-employment contract offered to workers may not necessarily be similar to their existing contract. Areas such as scope of work, roles and responsibilities and salary may be adjusted. Your employer is not obliged to offer you the same package for the re-employment contract.
Re-employment contract should be at least 1 year long. It should be renewable on an annual basis till the age of 67.
Read Also: What Are The Different Types Of Unemployment
Key Difference Between Retirement Age And Re-Employment Age
The key difference between the retirement age and the re-employment age is the fact that employers are not allowed to terminate workers before the retirement age (62) without valid reasons.
Beyond the age of 62, employers are expected to offer re-employment for workers who want to continue working though there is allowance for their scope of work and salary to be negotiated. This is assuming that workers are medically fit to continue working. Employers who are unable to provide re-employment options are expected to offer their workers a one-off payment equivalent to 3 months salary, subjected to a minimum of $4,500 and a maximum of $10,000.
Retirement Age & Re-Employment Age Does Not Mean You Have To Continue Working Till Then
One of the biggest misconceptions is the thought that a retirement age or re-employment age means workers have to continue until the age. This is not true.
Both the retirement age and the re-employment age are meant to protect the interest of workers, not their company. Workers can choose to retire earlier if they want to. An extension of the retirement or re-employment age does not change that fact. So no, you are not expected to work till 67 unless you want to.
What are your thoughts on both the retirement age and re-employment age? Are there further areas worth probing into? Discuss your point of view with us on Facebook.
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