~by: Leong Sze Hian~
The Re-employment Act has been implemented on 1 January 2012. Employers are now required to offer re-employment to their workers at age 62.
Many re-employment issues?
There may still be many unresolved issues with the re-employment act.
From the perspective of workers, for example, what if a worker is offered re-employment at a huge pay cut such as 50 per cent? Since re-employment can be offered for just 6 months or a year at age62, what happens at say 63? If you have health problems, what happens if you are offered re-employment without the continuation of your existing medical benefits and insurance? For those not offered re-employment, with a compensation of $4,500 to $10,000, what if they can’t get another job? Since the CPF Life annuity payout starts at 65, what happens to those who are not offered re-employment at 62?
As I understand that about 14 per cent of HDB flat mortgages are still outstanding at age 55, what about those who bought a HDB flat after age 32 on a typical 30-year mortgage, which may still be outstanding at age 62? Since workers with less than 3 years of employment, are not covered under “re-employment”, will some employers be less willing to employ those age 56 to 58?
In the past, the retirement age was just raised to 60, 62. Why not just extend the retirement age to 65 now, instead of giving employers so many options? I would like to suggest that we recognise model employers who say offer re-employment to all workers on the same terms?
Why not have an Equal Opportunity Employment Commission like Hong Kong? Are there any countries in the world that has legislation that allows employers to cut employment terms across the board in any way, just three years before workers’ retirement at 65?
Follow public sector?
I also refer to the Public Service Division’s (PSD) letter “Public sector not currently reviewing re-employment guidelines” (ST, Dec 22), in response to the articles “Public sector reviewing rehiring terms” and “Better rehiring deals in private sector” (ST, Dec 21). It states that “Our guidelines allow public agencies to re-employ up to 10 per cent of retiring officers in a year at the last drawn salary”. Does this mean that 90 per cent of public sector officers will get a pay cut? How was this figure of 10 per cent derived?
The public sector should be setting a good example, for the private sector to follow. If the private sector follows suit, then 90 per cent of workers may also expect a pay cut.
