MOM is weighing administrative action against employers who can afford retrenchment benefits but refuse to pay.
Acting Manpower Minister Jasmin Lau told Parliament on Oct 6 that the ministry may act in egregious cases, after repeated engagements and warnings. A kababayan who loses a job here may face this exact fight over payouts.
What changed
Retrenchment benefits are not mandated by law in Singapore. A tripartite advisory sets the norm at two weeks to one month's salary per year of service.
Based on 2025 retrenchment notifications, about 88% of employers paid benefits. Of those who did not, about a fifth cited financial difficulties, Lau said. The rest gave other reasons, including no legal obligation or alternative support such as keeping staff on payroll longer.
Close to 80% of retrenched workers who got no benefits in 2025 came from firms with fewer than 200 employees. The tripartite partners are also studying bringing forward the mandatory notification window. Firms with 10 or more employees now have up to five working days after notifying staff to inform MOM.
Who it affects
Singapore residents made up about three-quarters of Q2 retrenchments. More than half of retrenched residents are in their 40s and 50s. Degree-holders are a growing share, rising from 51% in 2021 to 66.4% in 2025.
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Re-entry is slowing. The share of retrenched workers finding a new job within six months fell from 60.7% in Q1 to 54.9% in Q2. About four in 10 who were re-employed took a pay cut, with a median wage drop of 25%.
MOM will investigate signs of unfair displacement, including possible disguised retrenchments, Lau said. The Employment Act is under review, with recommendations due by the second half of 2026.
Penalties
Lau stopped short of promising a blanket mandate. She said the Government must balance stronger worker protections with employers facing genuine financial difficulties.
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The administrative action she described is still under consideration, not a rule in force. No penalty amount or start date was announced.
What to do
Check your retrenchment notice and what your company says about benefits before you sign anything. The prevailing norm sits in the Tripartite Advisory on Managing Excess Manpower and Responsible Retrenchment.
MOM publishes labour market data and employment information at mom.gov.sg. The Employment Act review is expected to report by the second half of 2026.
