To retire or not to retire, that is the question
Seven things to think about to help you manage retirement effectively
With the end of the Default Retirement Age last year, how are employers managing retirement?
The DRA was a reliable prompt for discussions about retirement. Keen to retire employees had the date etched on their minds and were vocal about it, and others, not so keen, understood their employer was within their rights to retire them. When the DRA was removed it became unlawful for employers to retire an employee unless the reason for doing so can be objectively justified. Employees can retire whenever they wish and are required to provide their contractual notice to do so.
Having just turned 65, Tottenham Hotspur manager, Harry Redknapp, says he has no plans to retire and, like Manchester United manager, Sir Alex Ferguson, who is 70, plans to keep on working in football. According to the Daily Telegraph, Redknapp says that he would not know what to do with his time as he has no hobbies.
Many of your employees will share this view. Having forged their careers for the past 40 or so years, on reaching 65, they will still feel young enough to work another 5 or 10 years. How can you manage this?
- Prepare for an older workforce. This includes making the most of the experience to hand as much as it does about managing cost and risk
- Keep employees informed and have open discussions about retirement
- Make sure your performance management process includes discussions about retirement intentions as part of the wider discussion about short and long-term goals
- Set out clear goals and performance objectives
- Help your employees prepare for retirement through retirement planning
- Protect yourself from potential claims on the grounds of age by having a fair reason to dismiss and using a fair procedure
- Remember that a mutually agreed date that is well planned for helps both you and your employee feel good about the retirement and the years of loyal service beforehand.