How is retrenchment benefits calculated?

How is retrenchment benefits calculated?

Retrenchment Benefits The amount to be paid is as follows: Less than two years, 10 days’ wages for every year of employment; Two years or more but less than five years, 15 days’ wages for every year of employment; Five years or more, 20 days’ wages for every year of employment.

Is retrenchment benefit mandatory in Singapore?

While the government strongly encourages companies to provide retrenchment benefits, it is important to know that retrenchment benefits are not compulsory in Singapore.

How is layoff compensation calculated?

Extent of Compensation: A workman is entitled to lay-off compensation at the rate equal to fifty percent of the total of the basic wage and dearness allowance for the period of his lay off except for weekly holidays which may intervene.

Are there any retrenchment benefits for employees in Singapore?

Retrenchment benefits are not mandatory in Singapore but are highly encouraged to ensure a fair and responsible exercise. Leaders from the Ministry of Manpower (MOM) and the city-state’s labour union, NTUC, has frequently urged employers to treat retrenched employees with empathy and care.

How much does an employer pay for retrenchment?

If there is no provision, it will have to be negotiated between the employees (or their union) and the employer. The prevailing norm is to pay a retrenchment benefit of between 2 weeks to 1 month salary per year of service, depending on the company’s financial position and the industry.

How long does it take to get retrenchment benefits?

The Advisory suggests that the prevailing norm for retrenchment benefits varies between 2 weeks to 1 month’s salary per year of service, taking into consideration the company’s financial position and industry. If the retrenchment comes shortly after a salary reduction, the salary before the reduction should be used to determine the amount.

When do you get an ex gratia Retrenchment payment?

Employees who have served the company for at least 2 years are eligible for retrenchment benefits. Those with less than 2 years’ service could be granted an ex-gratia payment out of goodwill. The amount of retrenchment benefit depends on what is provided for in the employment contract or collective agreement (for unionised companies).