Of the two changes in life - from school to employment and employment to retirement - the latter receives less preparation but involves the greater challenge. Retirement requires individuals to move from activity and commitment, which they may have experienced for over 50 years, to inactivity. Increasingly employers provide guidance and assistance to employees.

Pre-Retirement Preparation

Ceasing to use employees at retirement is to become a more challenging process for employers by 2006 when anti-ageism legislation is to be introduced. One effect may be that employers may not be able to insist on set retirement ages, unless these can be objectively justified (e.g. on safety grounds). This could also mean a far greater number of dismissals on grounds of CAPABILITY. Preparation for the change from active earning life to inactivity (at least in economic terms) cannot be left until just before retirement age - irrespective of the date this is to take effect. Employees should be encouraged to think about and to plan for, the change in their lifestyle well in advance.

Draft Policy

Guidance on planning for retirement, is available to employees. We provide informal sessions on the subject and invite all employees to attend these, in company time, when appropriate.

  1. Five years prior to what is suggested as a 'normal retirement date' (NRD), employees will be sent an information pack containing a number of handouts, briefing notes and booklets dealing with various aspects of retirement including opportunities, challenges, organisations requiring assistance as well as those that can give assistance, etc., with the aim of provoking consideration of the matter. They will be asked if they are considering opting to change their NRD and if so, to what date.

  2. Employees will be invited to a Pre-Retirement briefing - 'The challenge of retirement' - held 6 months after the issue of the brief. This session will:

    1. deal with any questions arising from the brief;

    2. outline the pre-retirement programme;

    3. encourage spouses and partners to participate in the programme;

    4. allow those attending to question Organisation managers responsible for payroll, pensions and allowances, retirement reunions, etc.; and

    5. take bookings (including spouses if preferred) for an in-house pre-retirement course.

  3. Around three years before retirement all those who wish (with spouses) will be invited to the in-house course which will provide both general discussions and presentations and individual counselling sessions. The organisation pension advisers will be in attendance to explain options available under the Pension Scheme.

  4. If an employee decides to retire early, Personnel will make the arrangements concerning quotations regarding pension options, arrange payment of this and any other benefits payable. An employee who retires prior to the period in which the 'winding-down' leave is paid, will receive a payment equal to 10 days holiday pay for each year of winding down leave not taken.

  5. Commencing with the 3rd year before retirement employees (whilst continuing to earn their full salary) will become entitled to 'winding down leave' as follows:

    1. From the 3rd anniversary prior to the date of retirement, employees will be required to work only 4 days each week.

    2. From the 2nd anniversary: 3 days per week.

    3. For the last full year to retirement: 2 days per week.

    During this period the Organisation will adopt a pro-active role to provide guidance and assistance if requested. For example, should the employee be considering commencing alternative work, or setting up his own business, every effort will be made to allow the promotion of the business, and the clause restraining employees from other employment whilst working for the Organisation will be waived.

  6. A year before retirement, when the final salary is known, Personnel will provide a quotation of benefits and options payable under the Pension scheme for each member, and for all other retiring employees not covered by the Pension scheme, a note of benefits expected to be paid on retirement. Personnel will assist each employee to calculate their income likely to be achieved in initial retirement and to assess their financial position whilst earning capacity is still available.


Note

Traditionally pension benefits have been linked to the State Retirement age. It may be preferable in future to disconnect these two facets of employment.

Retirement

Adopting the above entails employees thinking about the change, so that dealing with practical implications may be made easier.

Procedure
  1. 3 months before the State Pension is due to be paid, Payroll checks that the employee has received a notification from the Contributions Agency regarding the payment of the State pension, and if not, assists chasing for this.

  2. Personnel arranges leaving celebration - date, venue, list of those attending, etc., the employee being asked to select a leaving gift in accordance with policy.

  3. A month before retirement, Payroll reviews the situation regarding any loans outstanding, statutory sick pay, etc., and advises Personnel of adjustments that may need to be made. (See WAGE PAYMENTS re deductions.)

  4. Personnel reviews the position regarding employees with company cars and considers whether the employee will be able to purchase the vehicle and, if so, obtains a price and discusses.

  5. Personnel arranges a retirement party, presentation of the gift, and payment of all outstanding sums via normal leaving procedure, and for the addition of the employee to the roll of retired employees.

Recent Developments

As this book was being printed, there was considerable discussion, in advance of anti-ageism legislation required by October 2006 regarding the possibility of the customary retirement age being increased to 70 either on a voluntary or compulsory basis. Were this to happen a considerable number of changes would need to be enacted - extending the upper age limits on a number of tribunal application subjects, redundancy etc. Attention has been drawn to the difficulties employers might experience dealing with ageing employees - possibly needing to use 'capability' procedures which could be very unfortunate when the subject had long and loyal service.

Post-Retirement

Many employers try to retain some contact with former employees which is often valued highly.

Draft Checklist

Following retirement, all retired employees will receive:

  1. A copy of each issue of the organisation newsletter.

  2. A retired employees' discount card allowing purchase of the Organisation products at a discount.

  3. Invitations to the retired employees' reunions.

  4. Invitations to attend shareholders' open days at the facility.

  5. Christmas cards and gifts.

  6. A year's subscription to Choice - the magazine of the Pre-Retirement Association.

  7. Visits from Personnel (for retired employees unable to attend the reunion(s)).

Death in Retirement

When a retired employee dies, Personnel should discover the date of the funeral, arrange flowers (or donation to charity as requested) and for a representative of the Organisation to attend. If there is a spouse or dependent, pension details should be obtained and provided. Personnel alters/deletes name from the mailing list.

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