On 5 March 2019, the Minister of Manpower announced that a tripartite workgroup on older workers consisting of government, trade unions and employers have finally agreed that the retirement and re-employment ages should be raised beyond age 62 and age 67, respectively. The workgroup has been discussing this issue since May 2018 and is still working to establish the new thresholds and the implementation timeline of the change.
Currently, employers are required to offer eligible employees a re-employment offer (up to age 67) when they reach retirement age at 62. Eligible employees should meet all of the following conditions:
- Be Singapore citizens or permanent residents.
- Be born after 1 July 1952.
- Have worked with the same employer for at least three years.
- Have a satisfactory work performance record.
- Be medically fit to continue working.
Although the re-employment offer seems to provide enough job security, in practice, employers tend to determine the re-employment length on a yearly contractual basis.
This change is expected to provide better job security to older workers, especially given that Singapore is the second-fastest aging country in the world.
Employers should monitor the implementation timeline of the proposed change and review their retirement policies and practices accordingly. In addition, employers should be aware that the increase of the retirement and re-employment ages is likely to raise the cost of medical insurance coverage for older workers.