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Extending re-employment age: Getting firms ready

Work is underway to get unionised companies ready for the day new laws kick in to extend the re-employment age beyond 65, says NTUC Deputy Secretary-General Heng Chee How.

SINGAPORE: Work is underway to get unionised companies ready for the day new laws kick in to extend the re-employment age beyond 65.

NTUC Deputy Secretary-General Heng Chee How revealed this to Channel NewsAsia on the back of recent comments by the government that it will work towards raising the re-employment age further, within the next few years.

Louis Hendricks has been working at the Keppel Club for the past 15 years, after retiring as a police officer.

Now 70, he said he's grateful that his employers allows him to stay on in his job.

With a wife and two children still in school, he said, being gainfully employed, for him, is a necessity.

"Not everybody is rich in Singapore, first of all. Secondly, they may retire from their first job, they may not have enough money. At least (with) the second employment, they can pay their utilities bill - paying of the bills only - at least they don't get into debts," he said.

At Keppel Club, those who reach retirement age will be offered a one-year renewable contract so long as they are in good health, have a good appraisal and the job is available.

There is no pay cut.

Re-employed workers are offered their last drawn salary and are also eligible for bonuses.

Their scope of work, though, may change. They will take on more administrative and mentoring roles.

The recreational club is one of the few unionised companies which are already on their own, re-employing workers beyond the age of 65.

About 7 per cent of its staff are in this age group, with its oldest worker finally calling it a day, at age 80.

Its general manager, Desmond Chua, said it makes business sense to retain committed and experienced workers.

"Rain or shine, this is a group of workforce that is very steady, very mature, very experienced and on the frontline. They are wonderful people, so that is why we feel that there is definitely value in employing them," he said.

The labour movement is currently in the process of identifying more of such companies so that others can learn from them.

It is part of efforts to get unionised companies ready for further changes to the Retirement and Re-Employment Act.

This was exactly what the union did before the new Retirement and Re-Employment Act kicked in, in 2012 which made it mandatory for companies to offer re-employment beyond the statutory retirement age of 62, up till 65.

The government is now considering raising the re-employment age beyond 65 to 67.

NTUC Deputy Secretary-General Heng Chee How said: "So our aim at the time was to move as many unionised companies as possible into a state of readiness so that by the time the law comes about, as much as possible, at least the unionised sector is ready.

"So now, we are going to mount, in a way phase two of this and we are in the course of collecting information from unionised companies again, with the help of unions, on who amongst them are employing workers beyond 65 years old.

"This is because we want to push for the re-employment age ceiling to be moved from 65 to 67.

"Different companies have different practices, so again through the collection of who is doing it, how they are doing it, we are again making examples and then at the same time encouraging others to say it can be done."

Employers say one area that needs to be addressed as Singapore's workforce ages is medical benefits.

Kurt Wee, president of Association of Small and Medium Enterprises, said: "It's going to become a central and integral segment of employment in any SME that they place focus on these areas when they hire age-old workers, because obviously when you are older, your chances of having a health or medical issue comes up more often and on a more prolonged basis.

"So some employers may look at whether it's a co-payment medical insurance plan or company sponsored plan.

"They may have to even look at situations where employees cannot be there for all months of the year and they have to have additional part-time or short-term manpower resource where they can plug in to fill in those gaps."

Keppel Club's Mr Chua said the "missing link" now are measures to help employers defray the cost of high medical insurance for workers above the age of 70. He hopes to see more help in this area.

Mr Chua said: "For those above 70, they can have some sort of insurance to help employers subsidise this cost or lower this cost. And that gives more opportunities for those who are healthy, beyond 70 years old, to continue working. So I think that is the missing link at the moment."

The good news is that employers are increasingly allowing workers to continue to be with them beyond the age of 65.

Last year, the employment rate for workers between the age of 55 and 64 was at an all-time high of 65%.

The employment rate for workers aged 65 and above was also at an all-time high of 22.9%.

Mr Heng said this shows that employers are enlightened and business savvy.
 

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