Employees who have worked for less than 2 years at a company are not eligible for retrenchment benefits. However, employers could grant an ex-gratia payment, i.e. out of goodwill to these employees, taking reference from the Advisory on retrenchment benefit payable to retrenched employees as a result of business difficulties due to COVID-19.
Employers should also refer to the Tripartite Advisory on Managing Excess Manpower and Responsible Retrenchment for other options to manage excess manpower. If retrenchment is inevitable, employers should implement retrenchment responsibly and fairly in line with the advisory.