Financial help proposed for older workers who can't be re-hired

Financial help proposed for older workers who can't be re-hired
By Saifulbahri Ismail, Channel NewsAsia | Posted: 16 November 2009 1311 hrs

SINGAPORE: Workers who cannot be re-employed after reaching retirement at 62 may be given financial help.

An Employment Assistance Payment (EAP) is being proposed to tide these employees over a period of time while they look for another job. It is part of a set of draft tripartite guidelines on re-employment of older workers announced by Manpower Minister Gan Kim Yong at a forum on Monday.

The guidelines, which will supersede an earlier advisory introduced in April last year, take into account feedback from both employers and unions. The recommendations seek to help businesses and employees better prepare for the re-employment legislation in 2012.

Alexander Melchers, chairman of the Tripartite Implementation Workgroup on employability of older workers, said: "Overall we find that companies which have an aging workforce find this a very timely process.

"The devil lies in the details - that's why we now have about two years to work along the guidelines and we encourage companies to implement as many of the elements of the guidelines as possible leading up to 2012."

On EAP, he said: "We implemented EAP because we thought it's important that employees who're eligible for re-employment but their company – for economic restructuring or rejuvenating reasons – is not able to re-employ them... (these) employees will have an opportunity to find a new job."

Union leaders say the EAP must not be used as the first resort.

Heng Chee How, deputy secretary-general of the National Trades Union Congress (NTUC), said: "I want to stress that the EAP is not a recommendation to companies to say, you just pay this and wash your hands off. Far from it.

"It is really to provide as a last resort for companies that have proven that they have undertaken best efforts and sincerely still cannot find a suitable same job or different job for their workers."

The guidelines call for the company which cannot re-employ a worker to pay a minimum amount. This is especially so for low-wage workers, given that they may have greater difficulty finding another job.

There should also be a maximum amount to moderate the financial burden on employers and to prevent the EAP from encouraging employees to stop working.

Stephen Lee, president of Singapore National Employers Federation, said: "Therefore, we think that the EAP should not be a small pot of gold for the individual. So, the EAP should be appropriate just to help the worker tide over to find another job."

When the re-employment law comes into effect, Qioptiq Singapore will be legally required to consider re-employing 21 of its workers who would have reached retirement. But for now, the optical components maker is taking steps to engage its workers on pre-retirement and re-employment issues.

Chua Teow Tzing, managing director of Qioptiq Singapore, said: "At least one year before, we start having a dialogue. We see that as a platform to interact with them, to see what they really desire, because there's the possibility of re-scoping the work.

"Some may choose a lighter side of things. Some would actually change their role from being a production member to becoming a mentor."

Initiating dialogue with workers before their retirement is among the best practices contained in the newly-released guidelines.

The draft guidelines also recommend that companies put in a performance-based wage system. Mr Gan said: "The re-employment of older workers, which allows for mutually agreeable adjustments in wages, will help companies implement competitive wages based on job worth, productivity and performance."

A public consultation on the guidelines is being carried out. The tripartite partners will finalise the guidelines by early next year.


- CNA/938LIVE/so/ir