Thu. Jun 13th, 2024

TL;DR – In other countries, maybe. In Singapore, no.

Imagine you are turning 60 tomorrow. That ought to be a happy occasion. After all, you’re going to be entering your sixth decade of life. But suddenly, your boss tells you that the company doesn’t want you anymore because you’re old and they rather have someone younger doing your job. How would you feel? I bet you’ll feel quite angry. How can your employer do that?! There should be some law against it.

Well… There is. It’s called the Retirement and Re-Employment Act (RRA).

What is in the RRA ?

The RRA protects Singaporean Citizens and Permanent Residents. The RRA states that the minimum retirement age is 62. Employers must offer re-employment to eligible employees who turn 62, up to age 67, to continue their employment in the organisation.

Does that mean I HAVE to work until I’m 67?

No. It doesn’t. You can stop working at any age you want. If you have earned enough money to last your lifetime by the time you turned 25, and you don’t want to work a single day for the rest of your life – go ahead, stop working. No law in Singapore compels you to work.

So what exactly is retirement age?

In countries like the UK, the retirement age is the age where an employee starts to draw a pension. In those countries, an increase in the retirement age means that a person starts to draw on his pension later. So, in those countries, an increase in retirement age is a bad thing.

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However, in Singapore, that is not the case. We don’t have the pension system. Instead, the retirement age in Singapore is meant to protect Singaporeans. Employers can’t ask you to leave on the grounds of age before the age stated in the RRA.

In other words, if you are 60 and your employer asks you to leave just because they think you are too old, you can submit an appeal to the Minister of Manpower. If it is found that your employer really dismissed you because of your age, your employer would be found guilty of breaking the law and would have to pay a fine of up to $5,000 or be sentenced to prison for up to 6 months, or both.

And what is re-employment age?

After you turn 62, have worked with your current employer for at least 3 years before turning 62, have satisfactory work performance, as assessed by the employer, and you still want to continue working, the RRA states that your employer MUST TRY THEIR BEST to continue to employ you until you are 67.

Your employer need not employ you in the same role, nor do they have to pay you the same salary. But your employer must try their best to find you a job in the same company, and offer you a contract for at least one year, renewable every year up to age 67.

Your salary may be adjusted based on reasonable factors such as new duties or responsibilities. You should negotiate these changes with your employer when you finalise your new contract.

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What if employer really can’t offer you a position?

The employer must do one of two things. First, they can help you find another job in another company. If not, they must offer you a one-off Employment Assistance Payment (EAP).

The EAP is offered only after a thorough review, as a last resort. It is meant to help you tide over a period of time while you seek alternative employment. It is a one-off payment equivalent to 3.5 months’ salary, subject to a minimum of $5,500 and maximum of $13,000.

If I retire later, does it mean I get my CPF money later too?

No. Of course not.

Regardless whether you are working or not, the moment you turn 55, you can withdraw whatever money you have in your CPF Ordinary and Special accounts after setting aside the full Full Retirement Sum (FRS) or Basic Retirement Sum (BRS) with sufficient CPF property charge/pledge.

Even if you are unable to set aside the FRS or BRS, you can still withdraw up to $5,000 of your Ordinary and Special Account savings when you reach 55.

The money you set aside for the FRS and BRS can earn you interest or be used to pay premiums for CPF LIFE. Once you reach the Payout Eligibility Age (PEA), which is currently set at 65 years old for those born after 1953, you will start receiving monthly payouts from your CPF savings. You get this even if you are still working.

In other words, if you are 65, and your employer has offered to re-employ you, and you take up his offer, you still get your CPF payouts in addition to your salary.

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That’s why raising retirement age is a good thing

Put all the above together, in Singapore, raising retirement age is a good thing. If you want to retire early, you can. No law in Singapore is stopping you.

If you want to continue working till you are older, then a higher retirement age and a higher re-employment age ensures that employers give you that option.

Labour Chief Ng Chee Meng chatting with mature workers at Gardens by the Bay (via)


That’s why we hope that more companies will heed the call of NTUC Secretary-General Ng Chee Meng to voluntarily raise the retirement age of their workers beyond the statutory requirement of 62. If that happens, older workers will be able to continue working, earn an income and contribute should they choose to.

How’s that not a good thing?

(Cover image via)



By Joey Wee

I am nice, most of the time!