Retrenchment is the termination of employees due to redundancy or reorganisation of the employer’s profession, business, trade or work. This includes situations where companies undergo liquidation, receivership or judicial management.
An employer who terminates an employment contract with no plan to fill the vacancy any time soon is presumed to have retrenched the employee.
The requirement to notify MOM of retrenchment applies to permanent employees, as well as contract employees with full contract terms of at least 6 months.
Note: If you are planning a retrenchment in your company, please refer to the Tripartite Advisory on Managing Excess Manpower and Responsible Retrenchment to find out what your company needs to consider.
Employers with businesses registered in Singapore and have at least 10 employees are required to notify MOM when at least 5 employees are given notices of retrenchment within any 6-month period.
Note: You are encouraged to notify MOM of your company’s retrenchment even when your company has fewer than 10 employees or when the number of employees given notices of retrenchment is fewer than 5 within any 6-month period. This will allow WSG and the tripartite partners to help affected employees find alternative employment or identify relevant training to enhance employability.
The notification must be submitted within 5 working days after your employee is notified about their retrenchment.
For the first 4 employees who were notified of their retrenchment, the notification must be submitted within 5 working days after the 5th employee is notified. Thereafter, the notification must be submitted within 5 working days after each employee is notified of his or her retrenchment in any 6-month period.
The 6-month period means any 6 consecutive months. It is not necessarily half a calendar year, and may cross over two calendar years.
You notified 4 employees of their retrenchment on 1 April. You are not required to notify MOM of the retrenchment as fewer than 5 employees were notified of their retrenchment.
On 1 September, you notified 3 more employees of their retrenchment. Including the 4 employees retrenched on 1 April, you have notified a total of 5 or more employees of their retrenchment within a 6-month period.
You are now required to notify MOM for all 7 employees who were notified of their retrenchment within 5 working days after 1 September.
Note: A working day is a day other than a Saturday, a Sunday and a public holiday.
To submit a retrenchment notification to MOM, you need to first prepare the following information:
- Company name and UEN
- Company contact person details
- Name of union (if company is unionised), and whether the union was consulted
- Number of employees on the date you submit the retrenchment notification to MOM. This includes all employees, i.e. Singaporeans, PRs and foreigners.
- Details of employees to be retrenched (i.e. name, NRIC or FIN, residential status, job title, date of effective retrenchment, date of notification of retrenchment to employees)
- Payment of retrenchment benefits and quantum
- Provision of employment facilitation assistance
With the information prepared, you can submit a notification to MOM. You need Corppass to log in. Apply for a Corppass if you don’t have one.
Failure to comply with the requirements on the mandatory retrenchment notifications under the Employment Act will be a civil contravention, for which administrative penalties can be imposed.
For assistance on employment facilitation services, companies can contact the following:
Workforce Singapore (WSG)
www.wsg.gov.sg
Phone: 6883 5885
Employment and Employability Institute (e2i)
www.e2i.com.sg
Phone: 6474 0606
Email: followup@e2i.com.sg
For further clarification on the mandatory retrenchment notifications, companies may approach MOM.
Phone: 6438 5122