If you've been told your position is being made redundant, the first thing to know is: you have legal rights. Singapore's Employment Act and MOM guidelines set clear rules on what your employer owes you. This guide walks you through the key entitlements, how to calculate your payout, and what to do if your employer doesn't pay up.
To qualify for retrenchment benefits under the Employment Act, you must have worked for your employer for at least 2 years. The Act doesn't set a fixed amount — it says the benefit should be negotiated or follow your contract. But MOM's prevailing benchmark, followed by most employers, is:
On top of this, your final payout should include: salary in lieu of notice (if you're asked to leave immediately), unused annual leave encashed at your daily rate, and any pro-rated bonus or contractual benefits.
Your employer must give you proper notice before your last day — or pay you for it. The Employment Act sets these minimums (your contract may specify longer):
If your employer tells you to leave immediately without serving notice, they must pay you salary in lieu for the full notice period. This is on top of your retrenchment benefit — they are separate entitlements.
If your employer refuses to pay your retrenchment benefits, underpays you, or disguises a retrenchment as a "performance termination," here's the process:
Remember: retrenchment benefits are separate from your notice pay, unused leave, and any contractual bonuses. Many employees accept a package without realising they're owed more. Before you sign anything, make sure you know the full picture.
Tell Vera your years of service, salary, and what your employer is offering. Get a clear breakdown of your entitlements — free, private, no sign-up.
General legal information only — not legal advice. For specific situations, consult MOM or a qualified employment lawyer.