Retrenchment notice and benefits

Under the Employment Act, employers are supposed to inform their workers before they are retrenched.

There is minimum requirement, ranging from one day's notice for employees who have worked less than 26 weeks to four weeks' notice for those who have worked for at least five years.

Employees who have worked for at least two years are also eligible for retrenchment benefits.

It depends on the collective agreement or contract of service, but the prevailing norm is a payout of between two weeks' to one month's salary per year of service.

In unionised companies, where the quantum of retrenchment benefit is in the collective agreement, the norm is one month's salary for each year of service.

Disguised retrenchments mean companies terminate employees without taking the necessary responsibilities.

NTUC assistant secretary-general Patrick Tay outlined more scenarios:

  • Workers axed by firms and given a one-off or ex-gratia payment, some of which are below industry norms.
  • Contract workers terminated due to loss of business contracts.
  • Contract workers have their contracts discontinued after their firms fail to retain business deals or have to shed staff on account of a slowdown. While legally permissible, this could be considered a layoff.
  • Workers asked to resign voluntarily. The companies tell them that being terminated "doesn't look good " on their resumes.

By the numbers


The number of workers who lost their jobs in the third quarter of this year.


Redundancies (consisting of retrenchments and workers under contracts) so far this year.


Redundancies last year.

SingaporeUnemploymentMINISTRY OF MANPOWER (MOM)