As Singapore’s population rapidly greys, employers will increasingly see themselves hiring more senior workers. The government is also taking proactive steps to ready both employees and employers for such a future.
Big investments are being made into upskilling the local workforce, with greater attention paid to mid-career and senior workers. Employers should also pre-empt this by implementing workplace policies that enable older workers to contribute.
Here are three ways that both employers and employees will feel a direct and instant impact today.
Read Also: 4 Government Support Schemes Singapore Businesses Can Tap On To Adopt A Senior-Friendly Workplace
#1 Increase In Retirement Age To 64 In 2026 (And To 65 By 2030)
Prior to 1993, the “unofficial” retirement age was 55, pegged to the CPF withdrawal age. This changed in 1993, with the introduction of the Retirement Age Act, setting the retirement age at 60.
In 1999, the retirement age was raised from 60 to 62. This held until 2019, when the government announced that it would raise the retirement age to 65 in phases – in line with the start of CPF LIFE disbursements.
The first phase kicked in on 1 July 2022, when Singapore’s statutory retirement age increased to 63. The next phase will kick in on 1 July 2026, when the retirement age will be raised to 64.
Changes to Retirement Age in Singapore
| Prior to 1993 | 1993 | 1999 | Jul, 2022 | Jul 2026 | By 2030 |
| 55 | 60 | 62 | 63 | 64 | 65 |
#2 Increase In Re-employment Age To 69 In 2026 (And To 70 By 2030)
The Retirement and Re-employment Act was introduced in 2012 to support older employees to continue working beyond the retirement age. By requiring employers to mandatorily provide re-employment opportunities, employees gain a form of employment protection.
Employees who hit the retirement age must be offered re-employment up to the re-employment age of 68 today.
The government will also increase the re-employment age on 1 July 2022 from 68 to 69. Similarly, the re-employment age will also be raised to 70 by 2030.
Changes To Re-Employment Age in Singapore
| 2012 | 2017 | Jul, 2022 | Jul, 2026 | By 2030 |
| 65 | 67 | 68 | 69 | 70 |
Of course, companies can go beyond the retirement age to retain employees even after their re-employment age.
Read Also: Retirement And Re-Employment Act: 7 Things Employers Need To Know About Retaining Older Workers
#3 Employers (and Employees) Have To Pay More CPF Contributions
In tandem with raising the retirement and re-employment age, the government also raised CPF contribution rates for senior workers. The burden to contribute more to CPF will be shouldered by both employers and employees. The government has supported employers whenever the CPF rates have been raised for senior workers.
The increase in CPF contributions will go entirely towards their Special Account, to further boost their retirement adequacy.
| Age bands | 2016-2021 | 2022 | 2023 | 2024 | 2025 | By 2030 |
| 55 and below | 37% | 37% | 37% | 37% | 37% | 37% |
| Above 55 to 60 | 26% | 28% (+2%) ·1% from employer ·1% from employee | 29.5% (+1.5%) ·0.5% from employer ·1% from employee | 31% (+1.5%) ·0.5% from employer ·1% from employee | 32.5% (+1.5%) ·0.5% from employer ·1% from employee | 37% |
| Above 60 to 65 | 16.5% | 18.5% (+2%) ·1% from employer ·1% from employee | 20.5% (+2%) ·1% from employer ·1% from employee | 22% (+1.5%) ·0.5% from employer ·1% from employee | 23.5% (+1.5%) ·0.5% from employer ·1% from employee | 26% |
| Above 65 to 70 | 12.5% | 14% (+1.5%) ·0.5% from employer ·1% from employee | 15.5% (+1.5%) ·0.5% from employer ·1% from employee | 16.5% (+1%) ·0.5% from employer ·0.5% from employee | 16.5% | 16.5% |
| Above 70 | 12.5% | 12.5% | 12.5% | 12.5% | 12.5% | 12.5% |
As we can see in the table above, the increase in CPF contributions will be shared by both employers and employees. For employers, cost will increase. For employees, they will also see a slightly lower take-home pay if they are earning the same salary.
For employees aged 65 to 70, the target CPF contribution rate was already achieved in 2024, and thus, there are no foreseeable changes.
Read Also: Complete Guide To Employer’s CPF Contributions In Singapore
Employers Will Be Given Financial Support Via CPF Offset Transition Scheme
A major component of the package includes a CPF Transition Offset package. This will pay employers a one-year offset for half of their increased CPF contribution requirements.
| Age Bands | CPF Transition Offset for Employers In 2022 | CPF Transition Offset for Employers In 2023 | CPF Transition Offset for Employers In 2024 | CPF Transition Offset for Employers In 2025 |
| 55 and below | – | – | – | – |
| Above 55 to 60 | 0.5% point | 0.25% point | 0.25% point | 0.25% point |
| Above 60 to 65 | 0.5% point | 0.5% point | 0.25% point | 0.25% point |
| Above 65 to 70 | 0.25% point | 0.25% point | 0.25% point | – |
| Above 70 | – | – | – | – |
Employers also received a Senior Employment Credit (SEC) from 2021. The SEC is to support firms that are employing senior workers and to safeguard the employability of senior workers.
For senior workers earning up to $4,000 a month, employers will receive between 2% and 7% of their wages in 2024 and 2025.
| Age of employees | 2021 | 2022 | 2023 | 2024 & 2025 | |
| 55-59 | For those earning up to $3,000 | 2% | 1% | – | – |
| For those earning between $3,000 to $4,000 | $240 – (6% of wage) | $120 – (3% of wage) | |||
| 60-64 | For those earning up to $3,000 | 3% | 3% | 3% | 2% |
| For those earning between $3,000 to $4,000 | $360 – (9% of wage) | $360 – (9% of wage) | $360 – (9% of wage) | $240- (6% of wage) | |
| 65-66 | For those earning up to $3,000 | 5% | 5% | 5% | 4% |
| For those earning between $3,000 to $4,000 | $600 – (15% of wage) | $600 – (15% of wage) | $600 – (15% of wage) | $480 – (12% of wage) | |
| 67 and above (in 2021 and 2022) 68 and above (in 2023, 2024 and 2025) | For those earning up to $3,000 | 8% | 8% | 8% | 7% |
| For those earning between $3,000 to $4,000 | $960 – (24% of wage) | $960 – (24% of wage) | $960 – (24% of wage) | $840 – (21% of wage) |
Read Also: Guide To Senior Employment Credit (SEC) Payouts For Employers Hiring Older Workers In Singapore
Businesses will receive the CPF Transition Offset (CTO) payout and SEC payout in two tranches.
- For wages paid from January to June each year, the CTO payout will be in September of the same year
- For wages paid from July to December each year, the CTO payout will be in March of the following year
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