I have been retrenched. Am I entitled to retrenchment benefits?
Last updated 03 Sep 2021
Under the Employment Act, retrenchment benefit is not compulsory. The amount depends on what is stated in your employment contract or collective agreement (for unionised companies). If there is no provision, it must be negotiated between you (or your union) and your company.
If you have worked for less than 2 years in the company, you are not entitled to retrenchment benefits. The company may provide an ex-gratia payment out of goodwill.
The Tripartite Advisory for Managing Excess Manpower and Responsible Retrenchment recommends a payout of retrenchment benefit at 2 weeks to 1 month salary per year of service, depending on your company’s financial position and the industry. Read more on responsible retrenchment.
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