S'pore man 'retired' by company at 63 without notice or payment, wins S$26,350 for wrongful dismissal

A man took the company that employed him to court recently, claiming wrongful dismissal for terminating his employment about three months after he turned 63, without notice or payment in lieu.

The company contended that the termination was lawful as it was "retiring" the man, and no notice or salary in lieu was required in such circumstances, according to a judgement dated Jul. 13.

It also argued that it offered re-employment to the man, but he had turned the offer down, which meant that it was not required to give him an employment assistance payment.

The man sought S$11,600 (about his two months' basic salary) in damages, and an employment assistance payment of S$14,750.

The full sum was ultimately granted to him by the judge at the Employment Claims Tribunals, who ruled that the company was lawfully required to give the man two months' notice or salary in lieu, and that it did not reasonably engage or consult him regarding re-employment.

Wrongful dismissal

The man was let go on Jun. 18, 2025, when the statutory retirement age was 63 years old.

In the notice of termination, the company informed him that it would "process [his] retirement" on Jun. 18, 2025, as his last working day, and his "retirement" would take effect from the following day.

It added that because this "retirement marks the natural end of [the] employment", it could let him go without giving the two months’ notice or salary in lieu as stated in his employment contract.

The judge said that the company breached the employment contract.

Under the Employment Act, a company was required to give two months’ notice or salary in lieu if it were to terminate the contract after the employee attained the statutory retirement age.

The judge also noted that the man was seeking only S$11,600 in damages, a sum less than two months of his gross salary, which was S$6,428 a month.

Thus, this claim fell within what he was "properly entitled to recover", the judge said.

The re-employment offer

The man argued that the company did not fulfil its obligations to offer re-employment to him, and thus it was required to compensate him with an employment assistance payment.

The judge pointed out that the company did not make any offer of re-employment to the man before he turned 63.

Re-employment discussions were initiated by the man himself over email on Jun. 8, 2025, and the company replied with an offer two days later.

In this offer, the man's salary would be cut from S$6,428 to S$4,000, and he would be under a six-month fixed-term contract.

His role would also be adjusted from area manager to training executive, due to a restructuring exercise that would render the man's original role redundant, according to the company.

The company gave him a firm deadline to decide and accept the offer by Jun. 17, 2025 — about a week after it was first made.

His request for a short extension, also because he was on medical leave, was declined.

The man ultimately rejected the offer, saying that it was drastically different in scope from his existing role, offered little employment stability, and involved a substantial reduction in salary.

The day after receiving this rejection, the company sent the notice of termination.

Was it 'unreasonable'?

The man contended that the terms of the proposed re-employment and the manner the company offered it were unreasonable.

Under the Retirement and Re-employment Act, the employer must offer re-employment for at least one year unless otherwise agreed by both parties.

The man highlighted this in his claim, and the judge acknowledged it as well.

He argued that since the company gave an offer confined to six months, which was not accepted by the man, the offer did not suffice to discharge the company's re-employment obligations.

On the points about the change in job role and reduction in salary, the judge said that these factors alone do not render a re-employment offer unreasonable.

However, he believed the company did not engage with the man early on the offer — a process that would have allowed "meaningful discussion" about salary, possible re-employment arrangements, and more.

"Where engagement is perfunctory or opaque, employees may feel that their past contributions have been overlooked, or that the terms proposed are imposed rather than fairly negotiated," the judge said.

He noted that the Tripartite Guidelines on the Re-Employment of Older Employees recommends that consultations on re-employment should ordinarily begin at least six months before retirement.

On why the company began discussions only three months after the man turned 63, the human resources executive who had liaised with him accepted that these requirements had been overlooked and expressed regret that the matter had not been addressed earlier.

She also explained she declined the man's request for a deadline extension due to "her own disposition and a desire to conclude the matter expeditiously".

Judgement

The judge believed it was "unsurprising" that the man came to view the re-employment offer process as unfair.

The way it was conducted "fell short of the standard of reasonableness", and thus the judge ruled that the company was required to pay an employment assistance payment.

He allowed the man's total claims for S$26,350 in full, and also ordered that the company pay S$250 in costs and S$70 in disbursements.