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24/10/2010 23:27:21
Re: Service Continuation After Retirement Contract

Hi there,
I would just like to ask some questions on behalf of my father. He had been working in his company for more than 30 years. For the past 6 years (after retirement age of 55 years old) his service was continued on either annually basis or half-yearly basis.

Recently, his employer gave him a letter stating that there is a new regulation for recruiting after retirement age employee. I was told by my father that the company requires him to stop his service for a period of 1 month before continuing his service with a new contract in December.

1) Is there such a regulation?
2) Would my dad be entitled to his benefits for retirement? If yes, should it be claimed at the point of this current dismissal or after the end of his new contract?

I hope you could help to clear my doubts and I would really appreciate it
Thanks in advance!

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KL Siew
25/10/2010 10:25:46
In the Employment Act, entitlement to various benefits such as annual leave, sick leave, termination benefit etc varies according the number of years of service. What your father's company is doing is trying to avoid that by giving the contract a break of service so that they will not be caught by requirements under that Act. It is not a termination of service yet unless the company does not renew the contract after the one month. Regulation 2(2) of the Employment(Termination and Layoff Benefits)Regulations as below makes it quite clear. Note the words "...periods between one period of employment and another does not in the aggregate exceed thirty days." If your father still has the intention to continue working, it is OK to accept the one month break and then continue working after that. After working for so long, I think your father really deserves a break.

"(2) For the purpose of this regulation a continuous contract of service for a period of not less than twelve months shall include two or more periods of employment which are not less than twelve months in the aggregate if the intervening period or periods between one period of employment and another does not in the aggregate exceed thirty days."
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