Retrenchment benefits

You will normally be eligible for retrenchment benefits if you’re an employee and you’ve been working for 2 years or more at your current company.

Those with less than 2 years of service could be granted a payment out of goodwill, depending on the company.

Read more about responsible retrenchment.

Benefit amount

The amount of retrenchment benefits follows the employment contract or the collective agreement for unionised companies.

You will usually get 2 weeks to 1 month salary for each year of service, depending on the company’s financial position and the industry.

For unionised companies, the norm is 1 month’s salary for each year of service.

Both the employee and company do not have to pay CPF contributions for retrenchment benefits.

Check your retrenchment package

Before you sign your retrenchment package, make sure you understand the terms and conditions clearly.

The retrenchment package is legally binding once you’ve signed it and this will affect your ability to negotiate or make claims later on.

If you’re facing an employment dispute about retrenchment benefits, contact Tripartite Alliance for Dispute Management (TADM) for help.

TADM helps to resolve salary-related claims and employment disputes.

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