Programs letting workers near retirement-age cut back on their hours while keeping some pay and benefits are becoming increasingly popular.
36% of human resource executives say they plan to offer a phased-retirement program this year, according to a new survey from asset management firm Mercer.
That’s up from 15% of companies that informally offered a phased retirement program last year, according to the Society for Human Resource Management.
“With inflation, there are employees who are not financially prepared for full retirement so they're requesting this. Based on certain positions, and there are employers also who are having challenges replacing certain retirees in the workforce, so they're also making this request of employees like a trial period for retirement,” Karen Burke, Knowledge Advisor at SHRM, said.
“it’s a win-win, I think employers get to keep good people and employees, get to work longer and enjoy that later phase of life there's so much to give,” she continued.
Aside from the financial reasons, other workers say they want to continue working after retirement age to give themselves a sense of purpose.
Phased retirement is happening in all kinds of industries to keep more experience in the workforce.
it ranges from tech and financial companies to health care and engineering.
Some companies are giving workers a new contract allowing them to come back to work on certain projects.
“And then there's a whole range of just simple continuation of the flexible working that many people are enjoying at the moment, you know flexing their hours because of COVID, being able to work more remotely and just extending that flexibility at work into flexibility into retirement,” Yvonne Sonsino, a partner at Mercer, said.
However, there are some challenges companies may face if they add a phased retirement option.
“The increased risk of discrimination claims, there's ways of getting around that. Having a formal plan in place and ensuring that is implemented consistently among all retirees can reduce some of those factors and concerns for employers,” Burke said.
If your company doesn't have a formal phased retirement program, it's something HR managers say you can bring up with your boss, to see if an agreement can be tailored for you.