The Ministry of Manpower (MOM) announced on 1 Dec that employers will continue to receive a subsidy for hiring older workers for at least another year.
Manpower Minister Lim Swee Say said that the wage subsidy to reward those who re-employ older locals will be extended beyond its original deadline of the end of 2015, during a site visit to packaging firm TCG Rengo.
Employers can get up to 3 per cent more wage credit under the scheme if they rehire Singaporeans aged 65 and above who earn up to $4000 a month.
Announced during Budget in February this year, the wage offset was introduced to help employers manage costs, pending legislation to raise the re-employment age to 67 by 2017. It will be extended until the new law kicks in. Currently, employers must offer re-employment to eligible workers when they turn 62, up to 65 years old.
Mr Lim said over 49,000 employers received $22 million from the Government for rehiring about 110,000 of these older workers.
National Trades Union Congress (NTUC) deputy secretary-general Heng Chee How said they welcomed the move, adding that this could help employers cope with higher training and healthcare costs which hiring older workers might incur.
However, he warned against treating it as a mere subsidy that lowers payroll costs, instead of channelling it into training or restructuring.
"We must think about what we must do to our HR processes, our operations methods, and our technology and equipment... so that when the law kicks in in 2017, companies are ready, and workers are ready."
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Source: “Wage subsidy for older workers to be extended”, (The Straits Times, 2 Dec 2015)