Singapore — The minimum statutory retirement age of 62 will stay, as the re-employment framework is working well in helping older workers remain employed, said Senior Minister of State for Health and Manpower Amy Khor yesterday.
Speaking in Parliament, Dr Khor noted that this statutory retirement age “protects workers below 62 from being dismissed on grounds of age”, but is not meant to — and does not — impede people from working beyond the age of 62.
She was responding to a motion filed by Jurong GRC Member of Parliament David Ong calling for removal of the retirement age and higher employer Central Provident Fund (CPF) contribution rates for older workers to help them accumulate savings.
The Retirement and Re-employment Act was enacted in Jan 2012, requiring employers to offer re-employment to workers from age 62 to 65. Dr Khor noted re-employment disputes number only two to three cases every month.
A survey conducted in 2012 showed that seven out of 10 retiring employees were offered re-employment on existing contracts without any change in their employment terms. Among those who accepted re-employment on a new contract in the same job, three out of four retained their basic wages, Dr Khor said.
Some 94 per cent of those who continued on existing contracts also saw no change in their basic wages, Dr Khor added.
In proposing to drop the statutory retirement age, Mr Ong said this would allow workers to become “empowered with their own decision of retirement than being subject to a legislative policy”.
He also noted that many re-employed workers do not have the option of maintaining their current terms of employment.
“The Government, by removing the statutory retirement age, will be sending a clear and strong message that there can be no room for institutionalised discrimination against mature workers in our society,” added Mr Ong.
In response, Dr Khor said the Retirement and Re-employment Act has only been in place for two years and time is needed to monitor its impact. She added that the tripartite partners may consider extending the re-employment age from 65 to 67, “at an appropriate time”.
On Mr Ong’s call for older workers to enjoy similar CPF contribution rates as their younger counterparts, Dr Khor agreed it was timely to review the rates, but said this has to be approached carefully so it does not adversely affect the workers’ employability.
“We announced in 2012 that we will equalise the contribution rates for workers aged 50 to 55 with younger workers aged 50 and below and we remain committed to do so,” she said.