Challenges

The Data – Demand

  • Labor Department: 55-and-older fastest growing segment of the American workforce.
  • “64% of workers age 18-64 envision a phased transition into retirement”
  • Majority of age 50+ consider formal phased retirement “‘very” or “‘somewhat important’
  • 27% of Americans plan to “keep working as long as possible.”
  • Another 12 percent say they don’t plan to retire at all

The Stats: Supply

  • In 2016,11% of companies offer “informal phased retirement”
  • In 2016, 5% of companies offer “formal phased retirement”
  • Just 21% of workers say employers enable reduced work hours, shift from full-time to part-time

The Dilemma

Fear of discrimination   Leaders worry that creating different exits may lead to dissatisfaction and, potentially, lawsuits

Part-time = reduced value   A common belief exists that reduced schedules mean a net loss in contribution, especially as employees age

Manager overload    The assumption exists that many managers lack the skill and judgment to make sensitive decisions and manage the outcomes

Fragile knowledge sharing   The transfer of unique knowledge from older workers is easy to claim, but has often failed in practice

The Deliverables

Employers who offered a range of Respectful Exits to their older workers have achieved a variety of positive outcomes.

Employer gains include:

  • Retention of highly valued employees 55+
  • Retention of middle-aged valued employees 40-55 (who are looking down the road)
  • Capture of unique, hard-to-replace knowledge, ROI from the company’s investments in employees
  • Enhanced mentoring, development efforts
  • Focus of pre-departure employees on high value work
  • Reduced payroll costs
  • Enhanced collaboration skills
  • New motivation for promoting health & wellness (maybe the health & wellness people can play an important role in this- let’s talk. -Lesli

Older Worker gains include:

  • Extended work life and income
  • Enhanced pension contributions
  • Continued engagement, contribution, and satisfaction
  • Role in knowledge transfer, mentoring
  • Healthy means of easing into retirement

The Design

We have worked with many dozens of companies on new forms of staffing and scheduling, including what we call “Respectful Exits.” These mutually respectful forms of phasing out of work can include 1) an open-ended reduction in work time, 2) a revised schedule with knowledge transfer and 3) voluntary termination with return to work on contract.

Our clients recognize that to be effective, Respectful Exits need to be based on shared principles and driven by mutual respect and gain. The drivers for this approach:

  • For the company: retention of valued employees beyond “retirement age”
    o The options had to be diverse enough to appeal to many employees
    o Work needed to be re-prioritized to align with reduced schedules
    o Knowledge transfer and mentoring had to be well-designed and execute
  • For the retiree: continued employee status, benefits and a path to full retirement
    o Assurance of longer employment on a reduced schedule
    o Receipt of prorated benefits with no negative impact on pension terms
    o Opportunity to eliminate low-value work and engage in mentoring