Retrenchment is becoming a growing concern in Singapore. Some 4,620 workers were retrenched in the second quarter of 2026, marking the fourth consecutive quarter of rising retrenchments. Only 54.9% of retrenched residents returned to employment within six months, compared with 60.7% in the first quarter.
For affected households, losing a salary means mortgage repayments, groceries and other commitments must be funded from savings while the job search continues.
In Parliament on 6 October, MPs questioned whether existing protections and assistance are sufficient. Here are five issues raised and what the Government said. Several measures remain under review.
Read Also: 8 Things You Should Do In The First 30 Days After Being Retrenched In Singapore
#1 Should Employers Have Stronger Obligations To Pay Retrenchment Benefits?
Retrenchment benefits are not mandated by law in Singapore. Payment depends on contractual provisions or negotiations where no provision exists. MOM’s prevailing guideline is between two weeks and one month’s salary for each year of service, depending on the company’s financial position and industry.
MOM said around 88% of employers paid benefits in 2025, based on mandatory notifications. Stronger obligations are being considered under the Employment Act review. A payout gives workers breathing room, but a guideline offers less certainty than a contractual entitlement. The policy question is how to provide greater protection while accounting for employers facing genuine financial difficulties.
#2 Can Employment Support Start Earlier?
Employers with at least 10 employees must currently notify MOM within five working days after informing affected employees of their retrenchment. Voluntary early alerts are encouraged while employers are planning a retrenchment exercise.
The Government is exploring earlier mandatory notifications and ways to facilitate contact while respecting workers’ privacy. Earlier assistance could give workers more time to prepare their CVs, identify vacancies and consider training. It could also reduce the uncertainty of not knowing where to seek help immediately after losing a job.
#3 How Can Workers Be Protected Against Disguised Retrenchments?
MOM’s guidance states that an employee is considered retrenched if their employer terminates the contract without plans to fill the vacancy soon. The description used for a termination therefore does not necessarily settle whether it constitutes retrenchment.
MOM said it investigates complaints and will work with tripartite partners on clearer guidance about retrenchment and the obligations that follow. Clearer guidance would help employees understand their situation and employers identify their responsibilities. Workers should not need to interpret unfamiliar employment rules alone while coping with job loss.
#4 What More Can Be Done For Workers Facing Longer Job Searches?
MPs asked about older workers and those facing difficult career transitions. The Government is reviewing support for longer transitions, including through the Tripartite Workgroup on Senior Employment.
Existing assistance includes the SkillsFuture Jobseeker Support Scheme, which provides eligible involuntarily unemployed individuals with up to S$6,000 over six months while they actively seek employment. Eligibility and activity requirements apply.
However, changing industries can require substantial preparation. Workers may need both financial breathing room and guidance on whether retraining can lead to suitable, sustainable employment.
#5 Should Emotional Support Be More Accessible?
MPs asked about counselling and stronger referrals when workers receive retrenchment notices. MOM said career coaches provide emotional support where needed; no new standalone counselling scheme was announced.
Existing tripartite guidance also encourages sensitive communication, time for employees to adjust and counselling where necessary.
Losing a job can affect confidence as well as finances. Accessible support can help workers process the news and begin planning their next steps.
These discussions highlight what workers need: fair treatment, timely assistance and support through the job search. The reviews will determine which additional protections are introduced.
Read Also: SkillsFuture Jobseeker Support Scheme: How To Receive Up To $6,000 If You Lose Your Job
Photo Credit: iStock/IVANVIEITO
