Retirement

Recruitment | Selection | Promotion | Training and Development | Redundancy | Retirement

From October 2006, compulsory retirement below age 65 is unlawful – you would need to justify any enforced retirements below that age.

You don’t have to set a compulsory retirement age - it isn’t required by law. In fact, compulsory retirement could mean you lose skilled people and affect your business productivity. Why train new staff or pay higher rates for agency workers, when an existing employee, who knows your business, could do the job.

Flexible retirement

Flexible retirement can be a useful way of preparing employees to handle the change between full-time work and full retirement.

There are alternatives to stopping work altogether – for example reduced hours, job-sharing, part-time working.

See if employees who have retired are seeking employment again. This could involve short-term contracts, re-employment as an advisor, temporary cover during holidays, sickness absence or busy periods.

Being flexible about retirement can mean reducing capacity without losing valuable workers and their expertise.

Mentoring

As older workers get near to retirement, involve them in mentoring other staff to pass on skills and experience.

Performance

Use performance standards - they don’t have to be complex but they are essential when dealing with poor performers. Don’t use retirement as an easy alternative for poor performance - it is not cost effective.

Indicators of good practice

• Your company has a retirement policy, which has been communicated to all employees and is fairly applied
• Your company has a succession plan, which allows the organisation to retain or transfer skills and knowledge that would otherwise be lost through retirement
• You provide your employees with support and guidance
• Employees have more choice and flexibility

Example of a letter informing the employee of their retirement date and of their right to make a request

Note to employer: You must inform the employee no more than one year but no later than six months before their retirement date what the intended retirement date is and that they have a right to request not to be retired. Failure to inform the employee of the date and their right may mean that the dismissal is unfair.

This letter should only be used if you are complying with the above time limits. If you do not, you are under an obligation to consider a request made by the employee at any time before retirement takes effect. You can get additional guidance on retirement from Acas.

Dear:
Staff Number:
Date:

1. I am writing to inform you that your retirement date will be [insert date] and that you have a right to request not to be retired.

1a. I will give careful consideration to any request you may make to work beyond this date and will inform you if I cannot let you. I am not required by law to give a reason.

2. Your request not to be retired must be returned to [insert name] no later than three months before the date stated in paragraph 1. Failure to do so will mean that you lose your statutory right to have your request considered and you will be retired on the retirement date above.

Name:
Signature:
Date:

Example of a letter informing the employee of a meeting to discuss a request not to retire

Note to employer: The meeting to discuss the request should be held within a reasonable period after the request has been received. The employee has a right to be accompanied at the meeting.

The companion can be:

• chosen by the employee
• a worker employed by you or the organisation.

The companion can:

• address the meeting but not answer questions on behalf of the employee
• confer with the employee during the meeting.

Dear:
Staff Number:
Date:

I am writing to inform you that after receiving your request not to be retired that there will be a meeting to discuss your request.

The meeting will be held on [insert date] at [insert time] at [insert location].

You have a right to be accompanied at the meeting by a fellow worker or a trade union representative. Your companion may be someone that you have chosen, but they must work for [insert name of organisation]. Your companion can address the meeting but not answer questions on your behalf although you may confer with your companion during the meeting.

After the meeting, if it is decided to continue your employment beyond the intended retirement date of [insert date], you will receive written notification reflecting these agreed changes to your contract.

If no agreement is reached you will receive further notification confirming your intended retirement date and informing you of your right to appeal.

Name:
Signature:
Date:

More examples of letters

The Acas guide Age and the workplace (PDF - 562 KB) includes more examples of letters, plus a 'fair retirement flow chart' to help employers through the retirement process.

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