If your contract specifies a notice period, you must either serve the notice when you resign or pay compensation in lieu of notice. Notice can be waived by mutual consent between you and your employer.
If you want to terminate the employment contract, you must give notice to the other party in writing in the form of a letter of termination or resignation.
The notice period must be the same for the employer and employee. The length of the notice period should be according to the written contract, or verbal agreement, if there is no written contract.
If you and your employer did not previously agree on a notice period, the following applies:
Length of service
Less than 26 weeks
26 weeks to less than 2 years
2 years to less than 5 years
5 years and above
A termination letter is mandatory. Any notice of termination, either by you or your employer, must be in writing.
If you did not receive a termination letter, ask your employer to give you one. Otherwise, you are still considered as an employee of the company.
- Have your employer sign the termination letter to acknowledge receipt. This helps prevent misunderstandings or disputes.
- Your employer is not required to give a reason for termination as long as due notice has been given. If you want to know the reason, talk to the company’s management or Human Resources department.
Start and end of the notice period
The notice period includes:
- The day on which notice is given.
- Public holidays, rest days and non-working days.
An employee is required to give 1 day’s notice and resigns today. His last day of work will be today, as the notice period includes the day when he served notice.
An employee is required to give 1 month’s notice. If she tenders her resignation on 15 July 2016, her last day of work will be 14 August 2016, as the notice period includes public holidays and weekends.
Waiver of notice period
Both parties may also agree to waive the notice period by mutual consent. Such a waiver should be done in writing.
CPF contribution during the notice period
You and your employer must make CPF contributions for your salary earned during the notice period, while you are still considered an employee of the company.
However, CPF contributions are not required for compensation in lieu of notice (notice pay).
Special situations during the notice period
Find out how leave and other scenarios may affect the notice period:
Taking annual leave is based on mutual agreement.
You can either encash or clear your annual leave if your employment was terminated.
If the unused leave is encashed, it should be calculated at the gross rate of pay based on your last drawn salary.
However, if an employee is terminated for misconduct, any unused leave will be forfeited.
You can use your annual leave to offset the notice period in exchange for bringing forward your last day of employment. In this case:
- You would only be paid up to your last day of work.
- The annual leave used to offset the notice will not be paid.
- After your last day, you can start work immediately with your new company.
Alternatively, you can use your annual leave during the notice period, and the days taken will count towards fulfilling the notice period.
If you apply for annual leave during your notice period, and your employer approves it:
- You will be paid for the full notice period.
- You are considered an employee until the last day.
- You cannot join a new company until the notice period is over.
If you apply for unpaid leave while serving notice, your employer can extend the notice period, but only with your agreement.
Whether unpaid leave is granted is at your employer’s discretion.
If you are covered by the Employment Act, and you take sick leave (paid or unpaid) during the notice period, it is treated as part of the notice period. Your employer cannot extend your notice period or claim for any short notice from you.
Reservist training is not considered as part of the notice period. For example, if you go for 1 week of reservist training while serving notice, your notice period will be extended by 1 week.
If you are serving notice, you are still considered an employee of your current employer.
You should check with your existing employer whether you can start work with your new employer during your notice period.
All employees, including those on a fixed-term contract, can resign at any time, as long as they serve the required notice stated in their contract, or make payment in lieu of notice.
If a notice period is not specified in the contract, then it should be aligned to the length of service.
As the workforce of a company directly affects its business, responsible employees should work with their employers to ensure a smooth handover. Employers should also make sure that all salary and allowances are paid to employees before they leave.