Addressing Retirement in the Workplace

Q. I am a new manager for a group of long-term employees. All reports state they are great at their jobs and committed to the organization. Sounds good, but I know nothing about them and their plans to stay or leave. I don’t want to be stuck holding the bag with two weeks notice of a retirement with a job I am still learning about. How can I start the discussion without being accused of age discrimination?

A. Having employees who are great at their jobs and committed to the organization is a good start for being a successful manager. It is also legitimate to have real concerns about how long the employees in your group are planning to stay. Many organizations are faced with similar situations and the fear you describe. I consulted with Jean Wilson, an employment law expert at Seyfarth Shaw LLP. I can confirm that it is not illegal for an employer to inquire about an employee’s retirement plan when there is a legitimate business reason to do so. Employers must proceed with caution so that legitimate inquiries do not become the basis for an age discrimination suit.

The federal Age Discrimination in Employment Act (ADEA) makes it unlawful for an employer to take adverse action against an employee because the employee is over 40 years old. The ADEA requires that employers make decisions based on an organization’s legitimate, business needs. Many states, including Massachusetts, have similar laws prohibiting age discrimination, some of which may impose additional restrictions.

Kristin McGurn, employment law counselor and litigator from Seyfarth pointed out that there is nothing in these laws that make succession planning or inquiring about an employee’s retirement plan inherently unlawful. McGurn cautions, however, that the danger arises when an employer uses retirement as a means to push out older employees to replace them with younger ones, responds negatively when an older employee does not affirmatively respond to the retirement inquiry or where an employer “harasses” an employee by repeatedly inquiring about the employee’s plans to retire.
Any conversation with your employees about succession planning and the potentially related topic of retirement should be carefully planned. Some practical tips should help to guide the discussion:
•Be mindful of what is said and how you say it. Employees are less likely to feel that questions about their retirement plans are discriminatory if the conversation is respectful, in the context of legitimate business and succession planning, and conducted by someone with whom the employee has a positive relationship.
•Inform your employees that the reason for the discussion is to aid the organization in planning for the future. The organization’s business needs should be at the forefront of every conversation.
•Do not limit the conversation to older employees. As a new manager (and on an ongoing basis), it makes sense to have discussions with all your employees about their long-term career goals. Including all of your group’s employees in succession planning discussions should dispel any inference that the organization is “targeting” older employees.
•Do not make any age-related comments during the retirement discussion. Avoid referencing an employee’s age and descriptions of employees such as being “older,” “younger,” “baby boomers,” part of “Generation X or Y.” Introducing these terms in a retirement discussion can transform a legitimate succession planning conversation into evidence of age discrimination.
•Repeated inquiries about an employee’s retirement plans, particularly over a short span of time, can be viewed as evidence of harassing or discriminatory conduct.
Conducted thoughtfully, workforce and succession planning is a valuable tool for any organization. In your case, hopefully it will make a great group of employees even better.
-Elaine Varelas, Managing Partner, Keystone Partners
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