A demand for years of salary after resignation can be alarming. However, a large demand and a legally recoverable debt are separate questions. A new Singapore employment judgment shows why an employee’s notice obligation, absence from work and salary received after departure should be examined individually. Rejecting the employer’s largest calculation may still leave a substantial amount payable.
The new Poten v Lee judgment
On 7 October 2026, the High Court delivered Poten & Partners Pte Ltd v Lee Won Sang [2026] SGHC 208. Poten’s interpretation of the notice clause would have produced a claim of S$1,737,433.79. The court did not accept that interpretation and also considered that it would operate as an unenforceable penalty.
Nevertheless, the employee was ordered to pay S$131,745.27: S$32,384.62 for payment in lieu of notice, S$32,384.62 in damages and S$66,976.03 for salary overpayment through unjust enrichment. The decision illustrates why an employment dispute should not be reduced to a simple account of one party winning everything.
Why resignation disputes need more than one calculation
An employment contract may contain a term of engagement, a notice clause, confidentiality provisions and separate arrangements for incentives or training. Those provisions can interact, but they do not necessarily create the same obligation. When a demand arrives, begin by identifying which clause the employer relies on and which act allegedly triggered payment. A total alone does not explain the legal or factual basis.
Similarly, an employee should avoid treating disagreement with one clause as permission to ignore all remaining duties. The practical review should cover communications, attendance, payroll and the proposed final working day. It should also distinguish a written agreement to shorten notice from an assumption that the employer has accepted an immediate departure.
Readers considering an exit can start with our guide on what to check in an employment contract. For an existing dispute, use that broader checklist to organise the documents, then obtain advice on the particular demand and the circumstances of the departure.
Start with the ordinary notice framework
The Ministry of Manpower’s guidance on termination with notice states that an employee whose contract specifies notice must serve it or pay salary in lieu, unless notice is waived by mutual consent. Notice of termination should be in writing. MOM also explains that the notice period must be the same for employer and employee.
For practical preparation, locate the signed contract and every variation affecting notice. Check whether the document says days, weeks or months. Put the resignation email beside the employer’s response and any later agreement. Record the proposed end date, the work actually performed and the basis on which payroll calculated the final payment.
Furthermore, distinguish permission to stop attending the office from the legal end of employment. A person may be on approved leave or subject to agreed arrangements that affect attendance. If the employer sends a short message such as “you can leave now”, ask for written clarification of the intended treatment of notice and salary. Clear questions at that point can prevent a much larger dispute later.
Ask for a breakdown of an exit demand
A useful demand breakdown separates the amount claimed under each contractual or legal basis. If the employer seeks payment in lieu of notice, ask which period is said to be unserved. If it seeks damages, ask what loss is alleged. If it seeks reimbursement of salary, identify the relevant payments and the employer’s explanation of why they should be returned.
- Request the clause or provision relied on for each component.
- Check the dates used in every calculation.
- Identify the salary components included and excluded.
- Reconcile money already paid, withheld or reimbursed.
- Ask whether separate claims overlap in their factual basis.
These questions are not an admission that the demand is valid. They make it possible to evaluate the claim. Likewise, an employer preparing a demand should provide enough information for a meaningful response. A carefully explained position is more useful for negotiation than an intimidating total with no supporting schedule.
Treat continued absence as a separate issue
MOM’s guidance on termination without notice addresses matters including contractual breaches, unpaid salary and absence without cause. A person considering immediate departure should read the applicable guidance and seek advice on their own position. An employment dispute can become more complicated when neither side documents whether the employment relationship continues.
From a practical standpoint, make an attendance chronology. Include days worked, approved leave, messages requesting attendance and responses explaining absence. If medical documents or another reason are relevant, preserve them accurately. Do not reconstruct dates from memory once a demand has arrived; compare the chronology with calendars, emails and workplace records.
For employers, keep personnel decisions and payroll instructions aligned. The manager who deals with the resignation, the HR officer who prepares the exit letter and the finance team making payments should work from the same approved dates. Conflicting instructions may generate payments that neither party understands and produce an avoidable argument about what those payments represented.
Do not spend a disputed payment before reconciling it
A bank credit does not explain its own purpose. Money received after resignation might relate to work already performed, an incentive, expenses or an error. The responsible starting point is to request an explanation and compare it with the payslip and contract. Avoid assuming that a payment automatically resolves all outstanding issues merely because the employer initiated the transfer.
In a hypothetical example, an employee leaves in June but receives a full July payment. The employee should ask whether it is final salary, an adjustment or a payroll mistake. The employer should investigate before describing it as overpayment. The same bank entry could have different explanations depending on the agreed dates and the payroll calculation.
Keep the amount identifiable while the matter is reviewed, and seek advice before agreeing repayment terms or authorising deductions. Our article on salary deductions for workplace mistakes addresses a related issue. A claimed repayment and an employer’s ability to deduct money from salary should not be casually treated as interchangeable.
Review unusual clauses with care
Long employment commitments may involve more than a normal notice period. For example, a contract might refer to an initial term, a retention payment or training costs. The drafting should explain whether these are separate arrangements and what happens if the employee leaves early. A reader should identify the commercial purpose and payment trigger before assuming that one provision determines every consequence.
That exercise is particularly useful for managers negotiating senior hires. If the business wants continuity, ask whether the written documents explain the intended handover, replacement arrangements and financial consequences. A clause that looks protective on paper may be difficult to apply if its relationship with ordinary notice is unclear.
For employees with a training commitment, our discussion of repayment questions when leaving before a training bond ends offers additional background. The current judgment concerns its own employment agreement; it should not be used as a shortcut for deciding whether every other retention or training arrangement is enforceable.
Prepare a realistic negotiation file
Begin with a one-page timeline and a separate financial schedule. The timeline should show the contract date, relevant changes, resignation, replies, attendance and payments. The financial schedule should show the employer’s claim, your response and the documents supporting each position. This format makes disagreements easier to isolate and avoids burying the key issue inside a long narrative.
Next, identify the practical objective. An employee may want a clean exit, a repayment timetable or a correction to the final account. An employer may want reimbursement, completion of a handover or confirmation about company property. Listing those objectives separately helps advisers assess whether a negotiated solution can address concerns that a money claim alone would leave unresolved.
Any proposed agreement should be reviewed for its actual wording. Consider the amounts covered, payment dates, treatment of disputed items and scope of any release. Do not assume that an informal exchange of messages settles everything simply because somebody writes “agreed”. Ensure that both sides understand whether the arrangement resolves the whole dispute or only one component.
What to bring to an employment lawyer
Supply the signed contract, amendments, resignation correspondence, payslips, relevant bank entries and the demand. Include documents that appear unfavourable, because your adviser needs to understand how the other side may use them. If there are competing explanations for a payment or an absence, set them out clearly rather than presenting an uncertain inference as an established fact.
Ask the lawyer to separate merits, procedure and commercial options. You need to understand which claims appear supportable, what deadlines apply and what a proportionate response could cost. The useful question is not simply whether the demand looks excessive. It is what remains payable, provable or negotiable once each part has been examined.
For HR teams, use this news as a prompt to review exit administration before the next difficult resignation. A consistent process should connect the contract, final working day, attendance permissions and payroll. It should provide a named contact for reconciliation queries, so that a former employee receives a clear explanation instead of several conflicting answers.
This article discusses the published ruling and general preparation considerations as at 11 October 2026. A person facing an actual employment demand should obtain advice using the full contract and payment history.
Frequently Asked Questions
Does the S$131,745.27 award set the price of resigning early in Singapore?
No. It reflects the particular claims and facts in this case. Another employee’s notice, remuneration, conduct and payments may be different. The amount is not a standard resignation fee.
Should an HR officer close the payroll account while a repayment dispute continues?
The team should preserve payroll records and use a documented reconciliation process. Closing routine access should not remove the evidence needed to explain past payments. Seek advice on any proposed deduction or recovery step.
Can I use a summary of this case instead of sending my lawyer the employment contract?
No. Send the complete agreement and amendments. A case summary helps identify questions, but your adviser needs the precise words, dates and surrounding documents to assess your own obligations.
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About the Author: Randy Alta
