Incentives for firms to re-employ workers past age 65

FROM next January, incentives will be given to companies that voluntarily rehire workers past age 65, before legislation kicks in to raise the re-employment age to 67.

This "promotional approach" was suggested by a tripartite committee and accepted by the Government yesterday, said the Ministry of Manpower (MOM).

Details of the incentives are now being worked out by MOM, together with the Finance Ministry and tripartite partners which include employers and unionists.

These will be announced next year but backdated to Jan 1, 2015.

Currently, companies are required by law to offer re-employment to eligible workers when they turn 62, up to the age of 65.

But the labour movement, especially, has been calling for the age to be raised to 67.

Since late last year, the Tripartite Committee on Employability of Older Workers (Tricom) has been studying the question of when this should happen. After consulting stakeholders such as unions and employer groups, Tricom recommends that the Government use incentives to coax companies to do it before legislation eventually kicks in.

It also issued guidelines in a Tripartite Advisory on Re-employment of Employees from Age 65 to 67, for employers that want to do it.

The labour movement welcomes and supports this advisory, National Trades Union Congress (NTUC) deputy secretary-general Heng Chee How said last night.

"Starting with promotion is not new," said Manpower Minister Tan Chuan-Jin, noting that the same approach was taken in 2012 to encourage firms to rehire older workers when they turn 62.

Mr Stephen Lee, immediate past president of the Singapore National Employers Federation, said the news should cheer bosses, who feared the legislation would kick in "too soon".

"We therefore welcome the time given to help employers to manage their older workers over the next few years before legislation sets in," he added.

Incentives will also help companies make the transition, said Association of Small and Medium Enterprises president Kurt Wee.

As for what these could be, Mr Wee said: "It can't get better than a kind of direct wage subsidy for older workers."

He noted that companies already have other forms of help, like funding to make workplaces and processes elder-friendly.

Older workers like administrative assistant Indra Mohan think the incentives are a "wonderful" way to nudge companies to keep their older workers.

"(This news) is a huge relief to many who are waiting and wondering what's going to happen next," said the 64-year-old.

Singapore's largest employer, the public sector, however, is taking the lead. It will re-employ its officers up to age 67, Deputy Prime Minister Teo Chee Hean, who is Minister-in-charge of the Civil Service, said in a statement.

The Public Service Division will announce the details, he added, without specifying when.

Its move was lauded by NTUC's Mr Heng: "This sends a strong signal to the other employers and we hope that many would emulate (its) example as soon as possible."

janiceh@sph.com.sg

linettel@sph.com.sg

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