Employee expenses are a major expense for almost all kinds of business. So retrenching employees is one of the preferred options for cutting costs if a business wishes to reduce expenses fast. Usually, the salaries of employees will increase every year, so the senior employees are usually paid more. So if a company wishes to reduce the number of employees, it is called retrenching. They will usually target senior employees. While younger people can easily get a new job, it is usually more difficult for senior employees to accept the fact that they have been fired from the company which they served for decades. Some tips on how to handle retrenchment in Singapore are discussed below.

Initial reaction

The companies realize that the retrenched employee will be very upset at being asked to leave, especially if he or she has worked with the company for more than one decade. This could cause harm to the company. In most companies, employees who are being retrenched are asked to leave the company premises almost immediately after they are informed of the retrenchment. In some sectors, people are asked to leave periodically, while in other sectors, the retrenchment can be completely unexpected. So depending on whether the employees have been fired earlier or later, they may be shocked to be asked to leave. They may be extremely upset and will sometimes find it difficult to adjust to the changing conditions.

How To Handle Retrenchment In Singapore (1)


One of the main factors which affect the ability of the person to adjust to retrenchment is the age of the person. Most companies are preferring to hire people below the age of thirty-five, so if a younger person is fired, it is usually easier to get another job. Also if the employee has worked with the company for only a few years, it is easier to accept the job loss. In contrast, if the employee has worked in the company for decades and his social network also mainly consists of the office colleagues, it is more difficult to adjust to changing conditions and it may lead to anger and resentment.


Though the retrenched employee may feel upset at losing his job initially, usually over a period of time, he will come to terms with the changed professional status. The time taken for accepting the change in conditions depends on multiple factors like age and how much the person liked the job. If the person did not like the work he did as an employee, he will find it easier to accept the changed conditions. Some people may accept the changed status due to job loss within a few days, while others may take it for more than one year.

Future plans

Accepting the fact that the company did not need his services any longer, the ex-employee may start planning for a better future. Though losing the job will usually result in loss of income, the person will have something which he did not have earlier: plenty of free time. This free time can be utilized to review the finances, plan for the future, and also apply for new jobs or other opportunities where the experience and skills of the person will be utilized better.