Preserve employment before retrenchment
The advisory updated on 20 January 2023 treats retrenchment as a last resort. Assess long-term skills and a strong Singaporean core, consult unions early, and consider redeployment, training, flexible work schedules and wage flexibility before ending jobs.
Annex A sequences measures by severity: reduce overtime, adjust work and leave arrangements, introduce shorter weeks or temporary layoffs, and use temporary wage adjustments with agreement. Changes must respect employment contracts and statutory obligations.
Fair selection, communication and payments
Use objective business needs and skills criteria. Do not discriminate by age, race, gender, religion, marital status, family responsibilities or disability. Explain the business reasons sensitively and give notice or pay in lieu.
Annexes B and C require employers to check final salary, unused leave, notice, retrenchment benefits and notification duties. Employees with at least two years of service are eligible for retrenchment benefits; under two years, an ex gratia payment may be provided. The amount follows contract, collective agreement or negotiation; prevailing norms are two weeks to one month of salary per year of service.
Help affected employees find work through WSG, e2i, unions and other placement partners. Communicate support to remaining staff and maintain a responsible transition rather than treating payment alone as the complete process.
Who must notify and when
Businesses registered in Singapore with at least 10 employees must notify MOM when they inform any employee of retrenchment. Submit the notification within 5 working days after notifying the affected employee. Use the official retrenchment-notification service linked below.
Early alert is a separate step
Employers planning retrenchment are encouraged to submit a voluntary early alert. MOM describes this as taking less than 5 minutes. It can provide advice and referrals to SWDA or e2i outplacement support. The subsequent mandatory notification remains due within 5 working days after employees are informed. Notifications help MOM, NTUC, SNEF and relevant agencies identify alternative jobs and training.
Secure transactions
MOM officers do not ask for bank-login details or money transfers over phone calls or email. If a request appears suspicious, check the official secure-transactions guidance or call the 24-hour ScamShield helpline at 1799.
Annex A: numerical limits and time-bank example
The advisory does not require all measures to be applied sequentially. For a shorter week it suggests taking up to 50% of earned annual leave, reducing no more than three working days weekly (three only for severe impact), normally for no more than three months at a time subject to review, and paying at least 50% on non-working days. Temporary layoff is suggested for no more than one month at a time, with at least 50% wages and up to 50% earned annual leave.
The Flexible Work Schedule example reduces 44 weekly hours to 40 for four weeks, banking 16 hours against later peaks. Union/employee support and Commissioner approval are required; this is not an informal power to withhold overtime. For direct wage adjustments, consult and agree before implementation, consider variable bonus/AWS/MVC first and set restoration rules when business recovers. The advisory discusses treating up to a 10% basic-wage cut as MVC where no MVC already exists, not a general permission for unilateral wage cuts.