Singapore Will Gradually Raise Retirement & Re-Employment Ages To 65 & 70 Respectively
With better healthcare and higher standards of living now, Singaporeans might want to stay in the workforce longer.
To support older individuals who wish to continue working, Singapore will gradually raise the retirement and re-employment ages to 65 and 70 years old respectively.
Speaking in Parliament on Monday (1 Nov), Manpower Minister Tan See Leng said this will also help Singaporeans better prepare for retirement.
Starting from 1 Jul 2022, the retirement age will be raised to 63 and the re-employment age raised to 68.
Retirement and re-employment ages raised to 63 and 68
Back in 2019, the Tripartite Workgroup on Older Workers recommended that Singapore’s retirement and re-employment age be changed in a step-by-step process.
In accordance with their recommendation, Singapore will now be raising the retirement age and re-employment age to 65 and 70 respectively.
According to The Straits Times (ST), this process will begin from 1 Jul 2022 where the retirement age will be raised to 63. The re-employment age will also be moved up to 68.
For subsequent shifts, timings will be subject to agreements between the tripartite partners of the ministry, labour union, and employers’ federation.
Better protect senior workers
Speaking in Parliament, Minister Tan said that by 2020, about a quarter of Singapore’s labour force was 55 years and above. This is a 16.5% increase from 10 years ago, reported ST.
Under such a framework, employers cannot terminate an employee based on age before the statutory retirement age.
If employees wish to work longer, they can be assured of continued employment until the statutory re-employment age.
Minister Tan continued that businesses also have the flexibility to adjust re-employment terms.
This will allow them to continue providing older workers with employment whilst remaining competitive.
If businesses wish to do so, they can also raise the retirement and re-employment ages prior to the official change.
Minister Tan says the public sector has implemented the change since 1 Jul 2021.
Senior workers’ CPF contribution rates to increase
The Tripartite Workgroup has also previously recommended increasing CPF contribution rates of employees aged 55 to 70.
This change that is planned to take place over a 10-year-period will help the elderly with retirement adequacy.
From 1 Jan 2022, senior workers’ CPF contribution rates will increase by up to 2%.
The change was originally scheduled for 1 Jan 2021 but was deferred to help businesses manage costs amidst the pandemic.
According to ST, the deferment was supported by the labour movement. It was seen as a balanced approach to help senior workers keep their jobs.
CPF withdrawal ages will remain the same — people can begin withdrawing at least $5,000 at age 55. They can also begin their CPF payouts at age 65.
Employers should adapt to support older workers
The government will help businesses adjust to these changes.
Last year, a $1.5 billion Senior Worker Support Package was introduced to offset seniors’ wages and additional employer CPF contributions.
Minister Tan also added that employers should make changes to their policies and processes to support older workers.
He elaborated that more age-friendly workplaces can be encouraged through job redesign and by providing more part-time re-employment opportunities.
Lastly, he emphasised that the increased retirement and re-employment age does not oblige workers to work longer.
Instead, it aims to provide flexibility for those who want to do so, reported ST.
Retirement age needs to adapt to society
Singapore government has long talked about raising the retirement and re-employment ages.
We’re glad that after the delay, this will finally be implemented come 1 Jul 2022.
With this change, workers who wish to continue working will be better protected and they won’t be unfairly dismissed due to age.
And like Minister Tan highlighted, those who do not wish to continue working can still go ahead and enjoy their retirement.
Have news you must share? Get in touch with us via email at hello@mustsharenews.com.
Featured image adapted from HRguru.
