Your pay and service
Use your monthly salary before any recent pay cut, as MOM advises.
Next: your notice period and last day, and retrenchment figures for Singapore.
How retrenchment benefit works in Singapore
No law sets the amount. MOM's prevailing norm is 2 weeks to 1 month of salary for each year of service, for employees with at least 2 years' service.
- What decides it: your employment contract or collective agreement. If neither sets an amount, it is negotiated between you (or your union) and the employer.
- Where in the range: depends on the company's financial position and the industry.
- Unionised companies: where the collective agreement states the benefit, the norm is 1 month of salary for each year.
- Under 2 years: no benefit is expected, though an ex-gratia payment may be made out of goodwill.
- CPF: neither you nor your employer pays CPF on retrenchment benefit.
- Here: 2 weeks is taken as 12 months ÷ 52 × 2 of monthly salary, and years of service include completed months.
Retrenchment benefit at common salaries
MOM's norm of 2 weeks to 1 month of salary for each year of service.
| Monthly salary | Years of service | At 2 weeks a year | At 1 month a year |
|---|---|---|---|
| S$4,000 | 3 | S$5,538 | S$12,000 |
| S$4,000 | 6 | S$11,077 | S$24,000 |
| S$6,000 | 5 | S$13,846 | S$30,000 |
| S$6,000 | 10 | S$27,692 | S$60,000 |
| S$8,000 | 8 | S$29,538 | S$64,000 |
Foundific calculations. Two weeks is taken as 12 months ÷ 52 × 2 of monthly salary.
What else to expect
- Notice: you are still owed your notice period, or salary in lieu of it, on top of the retrenchment benefit.
- Notification to MOM: employers with at least 10 employees must notify MOM within 5 working days after telling employees they are retrenched.
- Leave: unused annual leave is usually paid out on your last day, under your contract.
- Next job: see retrenchment figures and the median pay for your job.
Source: MOM, Mandatory retrenchment notifications.
Common questions
Is retrenchment benefit compulsory in Singapore?
Only if your contract or collective agreement provides for it. MOM's guidance is that employees with at least 2 years' service should receive one, usually 2 weeks to 1 month of salary for each year.
How much retrenchment benefit is normal?
2 weeks to 1 month of salary for each year of service. On S$5,000 a month after 6 years, that is about S$13,846 to S$30,000.
Is retrenchment benefit taxable?
Compensation for loss of employment is generally not taxable. Payments for work done, such as salary in lieu of notice and leave pay, are taxable.
Does salary in lieu of notice count as retrenchment benefit?
No. It is paid for the notice period and is separate from the benefit.
Sources
MOM
- MOM, Responsible retrenchment: who is eligible, the prevailing norm, unionised companies, salary cuts and CPF. Checked 21 October 2026.