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Written answer by Mr Lim Swee Say, Minister for Manpower, to Parliamentary Question on employees benefitting from revision of employment assistance payment

Employment practices

Notice paper no. 237 of 2016 for the third available sitting

Question no. 367 for oral answer


MP: Er Dr Lee Bee Wah

To ask the Minister for Manpower (a) since the last revision of the Employment Assistance Payment (EAP), how many employees have benefitted from this policy; and (b) what is the Ministry doing to solve the problem of employers dismissing or refusing to employ workers nearing age 62 in order to avoid paying EAP.

Answer 
  1. Under our current re-employment system, employers must offer re-employment to eligible employees who turn 62, and have worked in the company for at least three years. In doing so, employers should consider all available re-employment options within their organisation. This can include continuing on the same contract, or changing the job scope or work arrangements subject to mutual agreement with the employee. Our annual surveys suggest that over 98% of local employees who wished to continue working were offered employment beyond 62 since the re-employment legislation came into effect in 2012.
  2. Where the business situation genuinely does not allow the employer to offer re-employment, then, after having exhausted all other options, the employer is required to offer the affected employees a one-off Employment Assistance Payment, or EAP. This EAP is to help tide the employee over while he or she looks for employment or undergoes training. This should truly be a measure of last resort. 
  3. We would like to remind employers that it is unlawful to dismiss an employee under 62 on the grounds of age. After 62, employers are required under the law to offer re-employment to eligible employees up to age 65 (and 67 from 1 July 2017) or EAP if they are unable to offer re-employment. Failure to do so would constitute an offence. Workers who feel that they have been unfairly dismissed should come to the Ministry of Manpower for advice and assistance. 
  4. We also urge employers to not use age as a factor at all when hiring workers. Older workers can contribute their skills and experience to the company and should be valued especially given our slowing workforce growth. The tripartite partners are strongly committed to enable older workers who are willing and able to work to continue working for as long as possible. We also support employers to re-design jobs to become more age-friendly. We recently enhanced the WorkPro scheme to help companies make work easier, safer and smarter for older workers. We also recently extended the Special Employment Credit to encourage the employment of workers above 55. 
  5. We hope that employers will tap on the flexibilities and support available to them to continue to benefit from the skills and experience of older employees, especially in a tight labour market.