Hmm., what's the difference between redundancy and retrenchment?? None actually. Seems like a cause and effect situation...What is Redundancy?Redundancy occurs when, through no fault of your own, you are no longer required to work in
the job you have been doing. This usually happens because your employer no longer requires your job to be done by anyone. It is the job that becomes redundant, not you.
Redundancy may occur for a number of reasons, for example:
- a downturn in production, sales, or the economy generally;
- the introduction of new technology;
- business relocation;
- the duties of your position are re-allocated to other employees;
- the business merges with another business, or is sold; or
- an internal company restructure occurs.
What is Retrenchment?If you lose your employment as a result of a redundancy, that is called a retrenchment. At this point there is a termination of employment. An alternative to retrenchment might involve, for example, you being redeployed to a different position but still with the same employer.
Employment Law: Entitlement to Retrenchment BenefitsWhere the contract of employment is governed by Singapore law:
- there is no legal entitlement to retrenchment benefits unless expressly provided for in the employment contract or in respect of employees who are members of a union that has a collective agreement with the company, in the collective agreement.
- requirement to pay retrenchment benefits cannot be implied into a contract of employment by past practice or policy of the company.
The Employment Act provides that an employee employed for less than three years is not entitled to any retrenchment benefit if his service is terminated on the ground of redundancy or by reason of any reorganisation of the employer's business.
(Argh, bad news for me then!)Redundancy payments may only be claimed if expressly stipulated in the employment contract or the employer has implicitly agreed to it, or if there is a legitimate expectation based on past practice in some cases. Beyond that, retrenchment benefits are often paid voluntarily in Singapore. One or up to two months pay for every year of service is not uncommon.
Haizz... This is a really good timing to break the news lor... exactly after chinese new year celebration! And if i read/understand the words correctly, this is just the first round *shocked eyes! Must start thinking of my backup plans now... Hmm...