Changes to Singapore’s Employment Laws in Summary: 2021

It’s that time of the year again, a time for celebration and joy. Even for those non-religious, the wave of cheers with Christmas and the upcoming New Years is perhaps one of the bright spots in this on-going pandemic. And at the end of 2021, it is also important to note the general changes to employment that have occurred throughout 2021, so that we enter the next year well-prepared. 


The Singapore government had announced a series of extensions for various tax schemes in Singapore, in lieu of the on-going pandemic and to provide better support for businesses. Schemes such as the option to accelerate the write-off of the cost of acquiring plant and machinery (“P&M”), the carry-back relief scheme (with 2021 included in the year of assessment too), the Not-for-Profit Organisation (“NPO”) tax incentive (extended until December 2027) have all been extended, with many other changes too. Businesses should visit the IRAS website to find out more. 

Retrenchment Policies 

Coming into effect November 2021 onwards, employers in firms with more than 10 employees are required to notify the Ministry of Manpower (MoM) if any employee is retrenched. Previously, employers were only required to do so if five or more employees are entrenched within a six-month period (a retrenchment exercise). 

The employer would be given five days to notify MoM via an online platform from the day in which the notice for retrenchment is given to the employee. Employers are to pay all salaries, including unused annual leave, notice pay, etc., to their employees on their last day of work.  

This is part of COVID-19 support measures pushed out by the government, such that the government and relevant offices would be able to step in to assist the affected employee to provide employment and job search support.  

Retirement & Re-employment Age Adjustments  

The retirement and re-employment age for Singapore workers will be progressively raised to 65 and 70 respectively, up from 62 and 67 currently. This process will start from 1st July 2022, with the retirement age being raised to 63 and the re-employment age to 68. In accordance, CPF contribution rate for senior workers aged above 55 to 70 years old will also be increased by 2% starting from 1st January 2022. 

Work Permit Renewal Limits for Foreign Worker & Rebates 

For those working in the construction, marine shipyard and process (CMP) sectors will have limits placed on the renewal of their permits temporarily lifted in order to ease the labour crunch this sector is currently going through. CMP workers whose work permits expire between July and December 2021 can renew their permits for up to two years, even if they do not meet the renewal criteria such as the caps on employment period or employment age. 

Levy rebates on foreign workers (250 SGD per worker) have also been extended until March in order to help labour-intensive companies, especially those of the above sector. 

Fair Employment Guidelines to be Formally Legislated 

 Tripartite Alliance for Fair and Progressive Employment Practices (Tafep) is a three-way partnership between the Singapore government, the National Trades Union Congress (NTUC) and the Singapore National Employers Federation to provide fair employment guidelines. Although Singapore-based companies are already required to follow Tafep guidelines, enshrining it into law would give even more protection for the workers and allow the authorities more room to intervene. 

Overall, this has been a series of changes that signals Singapore to be moving towards a more progressive direction, with greater protection and coverage for workers. However, the on-going pandemic still introduces complications such as the limit of number of people in office as well as vaccination statuses affecting employment, as these conditions constantly fluctuate in such volatile times.