By Sue-Ann Chia, Senior Political Correspondent

THERE are still two years to go before a law requiring employers to rehire workers beyond the age of 62 is put in place. However, it would seem that employers are already being given a way out of rehiring their retirees.

The draft guidelines on rehiring older workers, announced this week, include an option for employers to make a one-off payment to workers for whom they cannot find suitable jobs.

The payment - called the Employment Assistance Payment (EAP) - aims to tide such workers over the period during which they are looking for another job. It is the most eye-catching among the raft of proposals drawn up by a tripartite group comprising representatives from government, unions and employers. The proposals are currently open for public feedback.

My own take is that the EAP, while well-intentioned, is a loophole that would effectively allow employers to show retirees the door - albeit with a golden handshake.

Bosses could use the provision as an excuse not to re-employ those who hit 62, by paying them off rather than keeping them on till they are 65.

According to the guidelines, 'employers should consider all available re-employment options within their organisation and identify suitable jobs for eligible employees'. The EAP should be offered only to those for whom 'suitable jobs' cannot be found.

However, the definition of 'suitable jobs' seems to be left to the employer's discretion.

As for the amount, the guidelines suggest no quantum, only that there should be a minimum threshold, which should not be so large as to discourage people from working.

Some employers have indicated that they might be prepared to pay three to six months of a worker's last drawn salary for the EAP.

This is a fairly substantial amount, but it would still be a cheaper option than keeping the 62-year-old on the payroll for another three years.

Reading the guidelines, the EAP provision seems to have been crafted with one group of workers in mind - those in senior management.

Clause 26 of the guidelines says: 'It is recognised that it would be more difficult for employers to re-employ senior management staff due to the need to facilitate leadership renewal and organisational change. In addition, as senior management staff have more options than other employees, the EAP would be an appropriate alternative if re-employment is not feasible.'

Leadership renewal is an admirable and necessary practice. But with people living longer - 50 is the new 40, 60 is the new 50, and so on - our assessments of when renewal should take place may need to be revised.

In any case, what is to prevent employers from extending the EAP exit strategy to lower levels of staff? In some cases, it is conceivable the EAP could lead to a company having fewer, not more, older workers on its payroll.

The EAP thus seems to contradict a message that the Government has been hammering home in recent years - that employers need to make more use of older workers.

The growing silver brigade was the reason why the re-employment law was mooted back in 2007. Due to be enacted by 2012, the law will make it compulsory for companies to offer to retain workers beyond the current retirement age of 62, till 65. This was seen - for now - as preferable to raising the retirement age to 65 immediately.

To be sure, the EAP proposal probably arose from a compromise among the parties during the tripartite talks that led to the current guidelines.

Employers probably feared being forced to rehire all their 62-year-olds. The EAP would have been pitched as giving them flexibility in the rehiring process, in the event that they really do not have 'suitable jobs' for older staff. It would also protect workers, by ensuring they were compensated instead of leaving empty-handed.

Despite these good intentions, the EAP lets employers off the hook too easily. For instance: Why can't the 62-year-old continue in his current job? Surely that job is not going to disappear when he turns 62.

As they stand, the draft guidelines already contain concessions to employers. Workers who are medically unfit, as well as those who are underperformers, would not be deemed eligible for re-employment.

Salaries can also be cut after 62, even if the worker continues in the same job. For some workers, this could be the second pay cut within two years, the first occurring at age 60, as the current law allows.

If Singapore is serious about dealing with an ageing society, there should be enough political will to push through the re-employment law without the EAP, which would offer employers a backdoor to boot out older workers.

Employers also should not duck their responsibility, such as by offering older workers re-employment terms calculated to be so onerous as to make them leave.

Apart from the re-employment law, the Government might consider tax measures to change employers' behaviour.

Employers will wise up sooner or later. They have to, for an ageing workforce - together with a slower intake of foreign workers as indicated recently by the Government - will cut the labour force. In fact, extending the careers of older workers would be one way of relying less on foreign workers, as it would enlarge the local labour pool.

The success of the upcoming re-employment law requires inculcating the right mindset in employers: Value rather than vanquish older workers.

With two more years to go before the law is put in place, there is more than enough time for employers to get used to the idea.

This article was first published in The Straits Times.