Retrenchment Package Calculator Singapore (2026)

Retrenchment benefit is usually calculated as a number of weeks or months of salary for each completed year of service. MOM’s advisory norm is 2 weeks to 1 month of salary per year of service. So an employee earning $5,000 a month with 5 years of service, paid at 3 weeks (0.75 month) per year, would receive roughly $5,000 × 5 × 0.75 = $18,750 in retrenchment benefit.

No. There is no law that forces a company to pay retrenchment benefit. The amount is governed by the employment contract or collective agreement, or negotiated at the point of retrenchment. MOM publishes an advisory norm (2 weeks to 1 month per year of service) that responsible employers are expected to follow.

Under the Employment Act, an employee who has served the employer for at least 2 years is eligible for retrenchment benefit. Employees with less than 2 years of service are not entitled to it, although an employer may still grant an ex-gratia payment at its discretion.

They are two separate payments. Retrenchment benefit compensates you for losing your job and is based on your years of service. Notice pay (or salary in lieu of notice) covers the contractual notice period — if the company ends your employment immediately instead of having you serve notice, it pays you that period of salary. A retrenchment package can include both.

In unionised companies, the norm is typically 1 month of salary for each year of service — the upper end of MOM’s 2-week to 1-month range. The exact figure is set out in the collective agreement between the company and the union.

Retrenchment benefit paid to compensate for the loss of employment is generally not taxable. However, payments such as salary in lieu of notice, payment for unused leave, and any gratuity for past services are taxable. IRAS assesses each component of a retrenchment package separately, so check your tax treatment with IRAS.

Yes. Any annual leave you have earned but not used must be encashed when your employment ends, including in a retrenchment. It is paid at your gross daily rate of pay. This calculator lets you add unused leave days to your total package estimate.

Beyond the package from your employer, retrenched workers can tap support such as the SkillsFuture Jobseeker Support scheme for involuntarily unemployed lower- and middle-income workers, WSG and NTUC’s e2i career services, course subsidies, and CareersFinder job-matching. Eligibility and amounts change over time — check the latest details on the official MOM and WSG websites.

The calculator applies MOM’s advisory norm and the standard package components, so it gives a reasonable estimate. Because retrenchment benefit is not fixed by law, your actual payout depends on your employment contract, any union agreement, and your company’s financial position. Treat the result as a guide for planning and negotiation.