SINGAPORE: A man dismissed about three months after reaching retirement age won his claim against his employer, with the courts awarding him S$26,350 (US$20,360) in damages.
The judgment, made public on Jul 13, ruled that the company had wrongfully dismissed the man and failed to meet its re-employment obligations.
So what actually happens when a worker reaches retirement age, and what can employees do if they find themselves in a similar dispute? CNA spoke to lawyers to break down what went wrong in this case, and what it means for workers and employers alike.
Employment lawyers said some companies make the same mistake as this man's former employer – thinking they can terminate a worker's contract once they hit retirement age without further consideration.
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The company had told the man his retirement "marks the natural end of employment", arguing the termination was lawful and that no notice or salary in lieu was required.
The employer was "a bit misguided" about its rights, treating retirement age as a guillotine on the employment contract, said Mr Nicholas Ngo, a managing associate at Simmons and Simmons.
But no such power exists – an employment contract does not simply end when a worker reaches retirement age, he said.
Apart from cases involving misconduct, companies must allow a worker to serve notice or pay them the equivalent sum when terminating any employment contract, said Mr Mathias Goh, a director at Breakpoint LLC.
This is why the man was awarded damages for wrongful dismissal, which formed a part of his claim.
Under Singapore's laws, if an employer does not address a worker's retirement, employment continues on the original contract's terms, lawyers said.
If no offer is made before retirement age and the worker keeps working in the same role, the employer is deemed to have re-employed them on their existing terms, Mr Goh added.
The re-employment contract offered to the man also fell short of the company's obligations, the tribunal magistrate found.
By law, a re-employment contract must run for at least a year unless both parties agree otherwise. The company had offered the man a six-month contract. Shorter contracts are allowed, but only with the employee's consent – which was lacking here, Mr Goh noted.
The company also argued it owed no employment assistance payment since it had offered re-employment and the man rejected it. But the magistrate found that because the company had not properly fulfilled its re-employment obligations, the payment was still due.
An employment assistance payment helps eligible employees who are not re-employed while they look for another job. Tripartite guidelines suggest a sum of three-and-a-half months' salary, within a minimum of S$6,250 and a cap of S$14,750 – the amount the man received.
Under the guidelines, an employer need not pay this if the employee rejects a "reasonable offer" for an internal vacancy. To assess reasonableness, courts look at both the offer's substantive terms and the procedure behind it, said Mr Goh.
“The employer doesn’t have free licence to cut the role, cut pay, redesignate it in a very capricious and unreasonable manner,” he added.
If a company cannot find an internal vacancy, it can transfer its re-employment obligations to another company – for instance, a subsidiary within the same group, said Ms Christine Ong, a partner at Virtus Law.
If no transfer is possible, or the worker rejects the second employer's offer, the original employer must pay the employment assistance payment.
Courts also weigh the procedure of the re-employment exercise, including the timing of the offer and how much time the employee was given to consider it, lawyers said.
In this case, the magistrate took issue with how the company conducted the exercise, ruling that it had not reasonably engaged or consulted the claimant.
The man turned 63 in March 2025, Singapore’s statutory retirement age at the time, and the company made no move on re-employment beforehand. He emailed about his re-employment on Jun 8, and the company responded two days later with an offer.
He raised concerns about the terms of the contract, including the six-month period and lower salary, and asked for more time to consider the offer while he was on medical leave.
The company said its deadline of Jun 17 was non-negotiable. The man then rejected the offer and the company terminated his employment the next day.
Lawyers said companies should engage workers on re-employment at least six months before retirement, and extend an offer at least three months out, so employees do not face undue pressure.
Many companies simply fail to track when employees reach retirement age, said Ms Ong, so discussions often start only once retirement is imminent.
"Because of that, when they realise, they start rushing through the discussions and they feel like they need to sort this out very quickly," she said. "The engagement with the employee starts being very rushed, very hurried. And then the employee gets upset because they don't understand what's going on or they feel like they're not being heard."
Starting discussions early helps ensure workers do not "go away feeling like this is just a box-ticking exercise", Ms Ong said. Where a company has already decided not to retain an employee, any offer made can end up "for show" – made with little explanation or room for discussion.
"Then the employee will get upset because they see it as being very disrespectful of someone who has probably worked there for a very long time," she said, adding that such queries mostly come from long-term employees.
While re-employment obligations rest with the company, employees can plan ahead for the later stages of their career, lawyers said.
Mr Kelvin Tan, co-head of Drew and Napier's employment practice, said workers can prepare by training for new roles and can initiate re-employment discussions from six months or more before retirement, with union support where applicable.
Since an employment contract continues automatically if no action is taken, raising the matter early can be a double-edged sword, said Simmons and Simmons’ Mr Ngo.
"The question in an employee's mind is: are you comfortable leaving it as is until your employer does something, or would you rather have clarity upfront?"
Employees in a dispute have three options, Mr Ngo said: approaching MOM, approaching a union, or filing a claim through the Employment Claims Tribunals. MOM's commissioner for labour may consult both parties or appoint a mediator, and the manpower minister can also direct re-employment or compensation.
The National Trades Union Congress (NTUC) said it assisted the worker in this case after he raised concerns about his employer's re-employment offer.
As the company was not unionised, a case officer assessed it as a potential retirement and re-employment dispute and advised him on his options. He first tried NTUC's voluntary mediation; when that failed, the case was escalated to the Employment Claims Tribunals.
To bring a claim to the tribunal, workers must first go through mandatory mediation with the Tripartite Alliance for Dispute Management, obtain a referral if unresolved, then file a claim through the State Courts system.
NTUC said it has seen more disputes related to retirement and re-employment in the past year, although cases involving retirement without notice or proper payment remain uncommon.
The Tripartite Alliance for Dispute Management arm that works with NTUC saw three such cases in 2025.
As of Jul 1, Singapore's retirement and re-employment ages have been raised to 64 and 69 respectively, and will rise again to 65 and 70 by 2030.
"As more workers choose to remain in employment later in life, it is common that workers may seek clarification or assistance to better understand their rights and entitlements," NTUC assistant secretary-general Patrick Tay said.
“As these changes are implemented, we hope that more workers will become familiar with their rights and the protections available to them.”
Mr Tay also stressed that companies should conduct re-employment and retirement exercises fairly and sensitively, with meaningful engagement with the worker involved.
“Re-employment should not be treated as a procedural exercise. It should be approached as an opportunity to retain experienced workers who are willing and able to continue contributing,” he said.
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The judgment, made public on Jul 13, ruled that the company had wrongfully dismissed the man and failed to meet its re-employment obligations.
So what actually happens when a worker reaches retirement age, and what can employees do if they find themselves in a similar dispute? CNA spoke to lawyers to break down what went wrong in this case, and what it means for workers and employers alike.
What happens after a worker reaches retirement age?
Employment lawyers said some companies make the same mistake as this man's former employer – thinking they can terminate a worker's contract once they hit retirement age without further consideration.
CNA Games
Show More Show Less
The company had told the man his retirement "marks the natural end of employment", arguing the termination was lawful and that no notice or salary in lieu was required.
The employer was "a bit misguided" about its rights, treating retirement age as a guillotine on the employment contract, said Mr Nicholas Ngo, a managing associate at Simmons and Simmons.
But no such power exists – an employment contract does not simply end when a worker reaches retirement age, he said.
Apart from cases involving misconduct, companies must allow a worker to serve notice or pay them the equivalent sum when terminating any employment contract, said Mr Mathias Goh, a director at Breakpoint LLC.
This is why the man was awarded damages for wrongful dismissal, which formed a part of his claim.
Under Singapore's laws, if an employer does not address a worker's retirement, employment continues on the original contract's terms, lawyers said.
If no offer is made before retirement age and the worker keeps working in the same role, the employer is deemed to have re-employed them on their existing terms, Mr Goh added.
What are a company's re-employment obligations?
The re-employment contract offered to the man also fell short of the company's obligations, the tribunal magistrate found.
By law, a re-employment contract must run for at least a year unless both parties agree otherwise. The company had offered the man a six-month contract. Shorter contracts are allowed, but only with the employee's consent – which was lacking here, Mr Goh noted.
The company also argued it owed no employment assistance payment since it had offered re-employment and the man rejected it. But the magistrate found that because the company had not properly fulfilled its re-employment obligations, the payment was still due.
An employment assistance payment helps eligible employees who are not re-employed while they look for another job. Tripartite guidelines suggest a sum of three-and-a-half months' salary, within a minimum of S$6,250 and a cap of S$14,750 – the amount the man received.
Under the guidelines, an employer need not pay this if the employee rejects a "reasonable offer" for an internal vacancy. To assess reasonableness, courts look at both the offer's substantive terms and the procedure behind it, said Mr Goh.
“The employer doesn’t have free licence to cut the role, cut pay, redesignate it in a very capricious and unreasonable manner,” he added.
If a company cannot find an internal vacancy, it can transfer its re-employment obligations to another company – for instance, a subsidiary within the same group, said Ms Christine Ong, a partner at Virtus Law.
If no transfer is possible, or the worker rejects the second employer's offer, the original employer must pay the employment assistance payment.
Related:
How should the re-employment exercise be conducted?
Courts also weigh the procedure of the re-employment exercise, including the timing of the offer and how much time the employee was given to consider it, lawyers said.
In this case, the magistrate took issue with how the company conducted the exercise, ruling that it had not reasonably engaged or consulted the claimant.
The man turned 63 in March 2025, Singapore’s statutory retirement age at the time, and the company made no move on re-employment beforehand. He emailed about his re-employment on Jun 8, and the company responded two days later with an offer.
He raised concerns about the terms of the contract, including the six-month period and lower salary, and asked for more time to consider the offer while he was on medical leave.
The company said its deadline of Jun 17 was non-negotiable. The man then rejected the offer and the company terminated his employment the next day.
Lawyers said companies should engage workers on re-employment at least six months before retirement, and extend an offer at least three months out, so employees do not face undue pressure.
Many companies simply fail to track when employees reach retirement age, said Ms Ong, so discussions often start only once retirement is imminent.
"Because of that, when they realise, they start rushing through the discussions and they feel like they need to sort this out very quickly," she said. "The engagement with the employee starts being very rushed, very hurried. And then the employee gets upset because they don't understand what's going on or they feel like they're not being heard."
Starting discussions early helps ensure workers do not "go away feeling like this is just a box-ticking exercise", Ms Ong said. Where a company has already decided not to retain an employee, any offer made can end up "for show" – made with little explanation or room for discussion.
"Then the employee will get upset because they see it as being very disrespectful of someone who has probably worked there for a very long time," she said, adding that such queries mostly come from long-term employees.
What can employees do in a dispute?
While re-employment obligations rest with the company, employees can plan ahead for the later stages of their career, lawyers said.
Mr Kelvin Tan, co-head of Drew and Napier's employment practice, said workers can prepare by training for new roles and can initiate re-employment discussions from six months or more before retirement, with union support where applicable.
Since an employment contract continues automatically if no action is taken, raising the matter early can be a double-edged sword, said Simmons and Simmons’ Mr Ngo.
"The question in an employee's mind is: are you comfortable leaving it as is until your employer does something, or would you rather have clarity upfront?"
Employees in a dispute have three options, Mr Ngo said: approaching MOM, approaching a union, or filing a claim through the Employment Claims Tribunals. MOM's commissioner for labour may consult both parties or appoint a mediator, and the manpower minister can also direct re-employment or compensation.
The National Trades Union Congress (NTUC) said it assisted the worker in this case after he raised concerns about his employer's re-employment offer.
As the company was not unionised, a case officer assessed it as a potential retirement and re-employment dispute and advised him on his options. He first tried NTUC's voluntary mediation; when that failed, the case was escalated to the Employment Claims Tribunals.
To bring a claim to the tribunal, workers must first go through mandatory mediation with the Tripartite Alliance for Dispute Management, obtain a referral if unresolved, then file a claim through the State Courts system.
Are such disputes common?
NTUC said it has seen more disputes related to retirement and re-employment in the past year, although cases involving retirement without notice or proper payment remain uncommon.
The Tripartite Alliance for Dispute Management arm that works with NTUC saw three such cases in 2025.
As of Jul 1, Singapore's retirement and re-employment ages have been raised to 64 and 69 respectively, and will rise again to 65 and 70 by 2030.
"As more workers choose to remain in employment later in life, it is common that workers may seek clarification or assistance to better understand their rights and entitlements," NTUC assistant secretary-general Patrick Tay said.
“As these changes are implemented, we hope that more workers will become familiar with their rights and the protections available to them.”
Mr Tay also stressed that companies should conduct re-employment and retirement exercises fairly and sensitively, with meaningful engagement with the worker involved.
“Re-employment should not be treated as a procedural exercise. It should be approached as an opportunity to retain experienced workers who are willing and able to continue contributing,” he said.
Continue reading...