The termination of employment in Singapore can be initiated by either the employee or the employer. Both the employee and the employer must follow the terms and conditions for termination stated in the contract of service.
Employees are generally hired with a probation of three to six months and will be hired as permanent employees after the probation period ends. The employment contract will usually set out the terms of termination and what notice is required, if any. It is vital for all employees to be sure exactly what their employment contract says so that they can proceed accordingly.
The termination of the contract of service can occur in the case of:
- Employee resignation;
- Employer dismissal; or
- Expiration of the contract terms.
Valid reasons for dismissing an employee can include:
- Misconduct, such as theft, dishonesty, disorderly or immoral conduct, and insubordination;
- Poor performance; and
- Redundancy.
Employers can suspend employees accused of misconduct during an inquiry for a maximum of one week and are still required to pay half salary to the employee during the suspension. Employers can seek to extend the suspension period by seeking approval from the Commissioner of Labor.
Termination with notice
If an employee’s contract specifies a notice period, then they must serve the stipulated notice period or pay compensation in lieu of the notice. Any notice of termination, either by the employee or employer, must be in writing.
If an employment contract does not specify a notice period, then the notice period is dependent on the length of the employee’s service.
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Notice Period for Termination of Employment |
|
|
Length of service |
Notice period |
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Less than 26 weeks |
One day |
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26 weeks to two years |
One week |
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Two to five years |
Two weeks |
|
Five years and above |
Four weeks |
A termination letter is mandatory for termination of employment, whether instigated by the employer or the employee. Either party wishing to terminate the employment contract must provide advance notice in writing to the other party.
It is illegal for an employer to refuse the resignation of an employee.
Termination without notice
If an employee resigns without giving notice, then the employee must forgo their salary in lieu of serving the notice period. If an employer dismisses an employee without notice, then they must provide compensation equal to the amount the employee would have earned during the notice period.
Termination due to breach of employment terms
Either the employer or employee can terminate the employment if the terms of employment have been breached.
An employer is considered to be in breach of contract if they fail to pay the employee’s salary within seven days of its due date. An employee is in breach of contract if they are absent from work for two working days without approval or without attempting to inform the employer.
Filing a wrongful dismissal claim
Dismissal is when an employer has terminated an employee’s contract of service. It may be with or without notice, and on grounds of misconduct or not.
It also includes situations where an employee resigns involuntarily.
Valid reasons for dismissal can include:
- Misconduct - employer establishes that an employee was engaged in dishonest or disorderly conduct at work;
- Poor performance - employee didn’t perform their job according to the required standards; and
- Redundancy - The employee’s job scope changed, and the old job scope no longer exists.
Wrongful dismissal occurs when an employee is dismissed without just cause. Wrongful dismissals include:
- Dismissal on discriminatory grounds based on age, race, gender, religion, marital status, and family responsibilities or disability.
- Dismissal to deprive an employee of benefits or entitlements, e.g. to deprive an employee of her maternity benefits.
- Dismissal to punish an employee for exercising an employment right, e.g. dismissing an employee after the employee submitted a mediation request to TADM for salary-related claims.
Filing a wrongful dismissal claim must be done within one month from the last day of employment to the Tripartite Alliance for Dispute Management (TADM). The TADM will ask the former employee to show proof that the dismissal was wrongful.
If the claim(s) cannot be solved through the TADM, then the case will be referred to the Employment Claims Tribunals (ECT). Claimants can refer to the Tripartite Guidelines on Wrongful Dismissal for details on what constitutes a wrongful dismissal.
For M&Es to submit a wrongful dismissal claim, they need to have served a minimum period of six months at their respective companies. Before the reform, M&Es needed to serve one year before making a claim. For non-M&Es, there is no minimum service period required.
Either party could, however, terminate an employment contract by providing written notice or by paying a salary in lieu of the other party.
Can an employee terminate employment at the end of a probation period?
Yes, either employer or employee can terminate the employment at the end of the probation period. This can be done by:
- Serving the required notice period stated in the contract or by mutual agreement with the company; or
- Compensating the other party with salary in lieu.
Transfer of employment
The employer is obligated to notify the affected employees or their union of the impending transfer within a reasonable time.
The employer has the right to transfer their employees to another employer if the organization is being restructured. A restructuring can involve a merger, take-over, sale of parts of the company, or setting up a subsidiary company.
The employee may be transferred to a related company such as a subsidiary, or to a totally unrelated company.
The terms or conditions of employment will remain the same unless the employee agrees to change them.
Employees’ rights during a transfer
Employees have the right to:
- Be notified of the transfer and of matters relating to the transfer;
- Be given the opportunity to consult your employer; and
- Preserve the original terms and conditions of employment under the new employer.
The employee has the obligation to serve the new employer in the same way as with the original employer.
Retirement and re-employment
The minimum retirement age is 63 years. Employers are not allowed to dismiss any employee based on an employee’s age.
Employers must offer re-employment to eligible employees who turn 63, up to age 68, to continue their employment in the organization.
Eligibility
Employees are eligible for re-employment if they:
- Are a Singapore citizen or a Singapore permanent resident.
- Have served your current employer for at least 2 years before turning 63 for employees hired at age 55 and above.
- Have satisfactory work performance, as assessed by the employer.
- Are medically fit to continue working.
