Last Drawn Salary Cap for Employment Assistance Package
- Gerald Giam asked whether the Employment Assistance Package (EAP) under the Retirement and Re-employment Act could be based on an employee’s last drawn salary instead of the current fixed cap of $5,500 to $13,000.
- Minister Josephine Teo explained that the EAP is a last-resort measure to support seniors seeking alternative employment after re-employment options are exhausted, with principles including reasonable months of salary, a minimum amount to protect lower-wage workers, and a maximum cap to moderate employers’ financial burden.
- The EAP was last reviewed in 2019 and remains aligned with these principles, which have contributed to high re-employment rates and raised the average effective retirement age beyond OECD averages.