Question

Dear All,

If the employee resigns 1 year before he turns 62 and we offer him a fixed term contract of 1 year after his 2 months notices, does employer still need to pay the EAP to him?

Kristine

Reply 1

When is EAP Payable? - EAP is only payable should an employer unable to offer re-employment with terms that are acceptable to the employee at the age of 62. Of course, this is on the condition that the eligibility criteria are met.

EAP is not payable since there is re-employment - In your case, there is a job offer after the employee resigns before age 62 and this would actually constitute a "re-employment". Since there is now a job offer and 're-employment', there is no need for EAP as per my abovementioned explanation.

When to consider EAP in this case? - Nevertheless, the point that the employer needs to consider EAP is at the end of this 1 year contract, ie, at the end of age 63. The employer would have to pay EAP if the employee meets the eligible criteria (medical fitness and work performance) and is willing to continue working but the employer has no suitable job for this person when he/she reaches 63.

In any case, I am of the view that this scenario in which the employee has resigned at the age of 62 and then the employer offers him a 1-year contract job defy logic, appears doubtful and sound 'fishy' to any external party.

Henri

Reply 2

You could read and understand how to apply “Responsible re-employment” found in MOM website.

Rose