Manpower Minister warns mandatory retrenchment notifications could discourage job preservation talks
Manpower Minister Tan See Leng cautions that mandating advance retrenchment notifications may hinder internal negotiations to save jobs and lead to the leakage of sensitive corporate information.
- Minister Tan See Leng warns that mandatory advance notifications may cause companies to finalise job cuts faster rather than exploring alternatives.
- The government is reviewing the Employment Act and the Jobseeker Support Scheme to better assist professionals and manage restrictive contract clauses.
- Authorities rejected a proposal to mandate higher retrenchment benefits for large firms, citing the risk of further job losses during financial distress.
SINGAPORE: Manpower Minister Dr Tan See Leng said requiring employers to notify authorities before retrenching workers could potentially discourage negotiations intended to save jobs.
On 3 March, Labour chief Ng Chee Meng and several Members of Parliament (MPs) from the National Trades Union Congress (NTUC) recently advocated for the implementation of mandatory advance retrenchment notifications.
They argued such measures provide a window for proactive assistance.
Dr Tan acknowledged the merits of advance notification but highlighted that mandating the requirement poses non-trivial challenges. He noted that retrenchment is a difficult process and remains a last resort for most companies.
Senior management and boards often conduct private negotiations to preserve as many roles as possible.
Dr Tan warned that mandatory notifications might inadvertently push companies to finalise job cuts more rapidly, bypassing these essential dispute negotiations.
Businesses have also raised significant concerns regarding the potential leakage of confidential and market-sensitive information. The Ministry of Manpower (MOM) is currently consulting tripartite partners on these issues and will provide an update in due course.
The minister also addressed a suggestion by the Workers’ Party chief, Pritam Singh, to require larger corporations to provide higher retrenchment benefits. Dr Tan emphasised the need for a balanced approach that protects workers while maintaining flexibility.
Dr Tan explained that company size does not necessarily indicate a firm's ability to fund retrenchment benefits.
Mandating higher payouts for large companies facing financial difficulties could inadvertently put even more remaining jobs at risk.
Currently, companies with at least 10 employees must notify MOM of retrenchments within five working days after informing the affected staff. Failure to comply can result in an administrative penalty of S$1,000 (US$741).
The Singapore National Employers Federation (SNEF) has expressed strong reservations about earlier notifications. SNEF argued that such a move could reduce operational flexibility and narrow the window available for redeploying workers within the same organisation.
The Senior Minister of State for Manpower, Dr Koh Poh Koon, also addressed calls to raise the salary cap for the Jobseeker Support Scheme (JSS). This scheme was originally launched in April 2025.
Labour MPs urged the government to increase the income ceiling from S$5,000 to S$7,600.
This adjustment would align the scheme with the median gross monthly income of professionals, managers, executives, and technicians (PMETs) in Singapore.
The JSS provides up to S$6,000 for individuals who have lost their jobs involuntarily. To receive these payments, recipients must actively participate in job search activities. Dr Koh noted that 3,500 individuals have benefited so far.
Since the scheme was only introduced last year, the government will conduct a full review once more data is available. This review will ensure the JSS remains well-targeted and sustainable for the long term.
Dr Koh also provided an update on the ongoing review of the Employment Act.
A tripartite workgroup has engaged over 2,000 stakeholders and is expected to publish its formal recommendations in the second half of 2026.
The review includes Part Four of the Employment Act, which covers work hours and rest days.
The government aims to ensure that time-based protections and overtime pay remain targeted at those who need them most.
Furthermore, MOM is discussing the use of restrictive clauses in employment contracts.
This includes non-compete clauses that prevent employees from joining competitors. New guidelines will be based on principles established by the courts.
Stakeholders have noted that the Employment Act has become increasingly difficult to navigate over time.
The workgroup intends to streamline and clarify key provisions to make the legislation easier for both employers and employees to follow.
