No Retrenchment Benefits? Ask MOM For Help

The Straits Times ran this story on 27 March 2009:

No retrenchment benefits? Ask MOM for help

WORKERS whose bosses do not pay retrenchment benefits can go to the Ministry of Manpower (MOM) for advice and help, Senior Parliamentary Secretary (Manpower and Health) Hawazi Daipi has said.

He was responding to Nominated MP Eunice Olsen, who said she knew of a company that refused to pay up until a worker threatened it with a lawsuit.

Under the Employment Act, employees with at least three years of service can claim retrenchment benefits.

But the Act does not state how much can be claimed. The amount varies according to industry norms, the firm's financial position and what is stated in the employment contract or collective agreement between a company and its union, said Mr Hawazi. It typically ranges from two weeks' to one month's salary for each year of service, he added. Employees with under three years of service usually get an ex-gratia payment.

The Act does not cover managers and executives for retrenchment benefits, but most bosses here pay them too.