Business development assignment help on: Retirement and employee people

The removal of compulsory Retirement age and the viability of employing people between the ages of 65 and 80

 Introduction

Retirement is the process of leaving the job when people reach to certain age. Employees leave the job and spend their rest of the time in their own activities.  Globally countries have been focusing on the retirement age for their citizens (Canstar Pty Limited,   2012).  Retirement scheme is planned by an organization because they can attract the new talent and layoff the old talent who are older in age. The compulsory retirement process will discriminate on the basis of age, and they will be treated poorly due to their uneven performance level. The employees in an organization can retire whenever they want by giving the notice period. The organizations can only enforce the compulsory age for retirement if they want to hire new talent and improve their performance. Since 2011, the compulsory retirement age of 65 has been completely removed. The retired employees find difficult to get a new job because of their aging factor. Employers had to face the problem because they had to discriminate the employees on the basis of age. Though employees cannot force the employee’s to work beyond 65 years of age. It will help the employees to request the employers if they want to work for some more time or want voluntary retirement. If the employers do not agree to their employees request then in such case the employees can claim the compensation from the employers. Previously when employees were forced to retire at the age of 65 because of decrease in their performance level and the age factor which was not genuine. It has provided benefits in form of recruitment and retention of the better skilled workers. Company’s management was justifying that the employee’s knowledge and skill matters more than their age (A guide to good employment practice,     2007).  As 65 years of retirement age has been removed in such situations certain changes have to be made for managing the performance and skills of old aged employees.

Retirement Age as 65 Years

There are certain benefits of removing the retirement age as 65 years. The employers need to work with lesser policies with a flexible approach (Department for Business Innovation & Skills,   2011). It will provide a better platform to discuss about the succession planning between different age group of the employees. Some percentage of employee’s turnover is also related with the retirement factor. Employers do not have to rely upon the compulsory retirement. It is stated that there won’t be any negative impact for the young workforce. It will also open the doors for the employees who are having enough skill sets but are in an age group of 64 or below. There will be long-term stability of employees in an organization. It will also help in increasing the country’s economy rather than being a burden related with an expenditure part (Human Right & Equal Opportunity Commission,   2000). People management is much more important than planning the default retirement age as 65 years. Exit interviews can be planned with the consultation of the employees. The organization can grow by tracking the performance of the employees, identifying the training needs, planning their future after they leave the organization. The employees do not have to depend upon the government programs such as retirement schemes and health related programs. It helps to contribute in form of taxes to the government (Urban Institute    2009).

Literature Review

In the year 2011, Default Retirement age (DRA) of 65 years was abolished with the support of Employment Equality Act. If employees are retired at 65 or below 65 in such case the employer needs to give the explanation. As a part of review the company’s stakeholders were invited to design the pension schemes for the employees. Evidences have to be submitted why the employees have been retired. The justification was given why the retirement plans have been made mandatory (Crown,   2010). The ministers planned whether it should be kept or removed. It was reviewed to know the impact of the employers and the employees. This practice was related to the recruitment, redundancy and the employment benefits programs. The aged based practice of hiring and retaining was also related with this Default Retirement Age plan. Larger employers were having more knowledge and it was found more important to them as compared to the smaller employers who had less knowledge about different Act and employee’s related program. About 36% of the employers responded that they knew about the Default Retirement Age plan. On behalf of employment equality and Default retirement Age, Government reviewed some plans on 2011. It was declared that more focus should be given on the skills and knowledge rather than the age of the employees. There were issues like some of the jobs were categorized as per the age of the employees. The older aged employees had a positive attitude towards their work as compared to the younger employees. The result was gathered on a qualitative and the quantitative basis. It was also explained that after 65 years of age majority of employees did not want to work with the company and wanted to spend their rest of the life with their family members. It was also observed that majority of the employees request was being accepted by the employer. It was the wish of the employees whether they wanted to work or not in an organization. The employees who did not want to work after 65 can apply for flexible working systems. Employees had a perception that if they stay in an organization after 65 years of age, they could not be valued by the employers in the same way as they were valued in the young age. The performance of employees was linked with the age of the employee. They are to be treated with respect and dignity within an organization (Department for Business Innovation & Skills, 2010).

 Viability of employing people between the age of 65 & 80

If we see the viability of hiring employee’s between the age of 65-80 years. The employees can enjoy the tax benefits and they feel motivated to work. The organization have the people who are matured enough to take the decisions related to business. In the time of crisis in business they are the one who will support the organization because they have belonginess towards it. They have long tern experience which helps them to avoid the mistakes. They are the best people who can guide the new employees at their workplace (Role Models Foundation Inc,   2003). Certain Acts have to be implemented by an organization such as Equal Employment Opportunities, age free recruitment system should be designed, and a balance scheme development plan, flexible working arrangement should be prepared. The Business of an organization can grow if the employees are recruited to avoid future shortage, employers do not need to spend on the retention strategies, skilled and knowledgeable experience can be implemented. Employees involve in work and engage themselves in social interaction. Old employees respect and obey their supervisors in an organization (House of Common Committees of Public Account,     2005). They like to work in flexible working conditions with better accuracy. Employees respect the customers with dignity are loyal to everyone. They support the organization as being their backbone, are quite loyal to their profession, and support the technological assistance (Australian Bureau of Statistics,   2006).  If the matured and experienced employees are replace with the new employees in such case it quite risky. The employees who are above the age of 65 can save more than the young people. Government and Organization needs to lower the tax rates and provide different benefits of to the employees. These age group employees can develop the religious and cultural atmosphere. They are also contributing for the social welfare of the society. The contribution can be in form of  charity, donations, and philanthropical activities .There are certain disadvantages such after reaching the age of 65 employees suffer from different types of health related problems. They do not have the same fitness as they were having in the young age and organizational productivity is also impacted. They cannot bear more stress at work place. They become dependent upon their family members. Organizations need to spend their money on the retirement schemes for their old aged employees. Government also needs to plan the expenditure for the retired people and have to invest huge on them. They are unable to adapt the new technologies and are quite rigid upon their decisions. They fear with the changes that takes place in an organization. It was found that the cost of retaining the old employees was higher as compared to the new employees. Therefore the recruitment plan was not implemented. The employers need to plan the different scheme for the employees. Employees were treated as a part of discrimination process in an organization between the employers. It requires formal procedure such as giving notice of 6 months before the retirement (SHRM,    2012). The employees should be retired because they cannot cope up with the technologies, includes different types of the cost, they take more time to complete the work, they are less creative as their immunity reduces, and are absent from the work because of health related issues. The economy shrinks because due to various expenditures related to the ageing. Even in an organization there should be proper lift system, working condition, better sitting arrangements and health services for the old aged employees. There is de-motivation factor among employees because they are paid poorly due to decrease in their performance level. As per the survey of KPMG, the employees who reaches to the age of retirement wants to have their own home, car and the luxuries of life to live happily with his family. The retired employee’s positions will be filled by the young age employees. The employees also enjoy the senior citizenship benefits. There are various reasons for planning the retirement plan and it may be from the employer and the employee’s side.

Conclusion

Retirement is basically a phase which is related with the independent factor of the employees. It requires a flexible approach from the organization side to plan a retirement program. Whenever the retirement scheme is planned the employee’s physical health needs have to be considered. Organizations must also plan in such a way that it becomes a motivating factor for the other employees. It will provide autonomy to the employees and life can be enjoyed in better manner. It will help to decide about what activities need to be planned after the retirement. It will be a time period when the employee’s will be socially engaging with the friends and the family members. Much emphasis is given upon the health factors. The employees can experiment new things related to the lifestyle and their health (Demand Media, Inc.     2012). Sometimes the retirement plan can create stress for the employees because they are able to work and due to the age factor they have to retire early which creates a negative impact upon their mind. The employees feel that they have not been valued by the organization. The removal of compulsory retirement age will help to provide autonomy to the employees to decide what they need to do and the employer cannot force the employees for the early retirement process. Management always wants their old employees to stay along with them because they have faith and respect for them. They have been regularly contributing their support at the times of difficult situations. The replacement cost of an old employee is very high for an organization because it is difficult to find the person with same sort of loyalty and the competence level. The employees also miss the ambience of the office and their colleges with whom they have been working for longer period of time. It is known that early retirement is a process to reduce the unemployment situation in an organization. Though the viability of business depends upon the nature of an organization which has been hiring old aged employees. In the service industries the old age employees can contribute better as compared to the manufacturing industries where the working conditions are strict and hazardous. Though the employee seems fit by physical appearance but may lack the strength to uplift the heavy machines or perform the work which requires physical effort. They can be consultant because they will be having the rich experience to share with the younger employees. They will also feel that they have been valued and engaged in a fruitful work. Age discrimination at the workplace impacts the productivity of the organization and affecting it globally. There was a restriction upon the employer’s flexibility because they could not manipulate it and ask the employees to retire before the appropriate time period. It has been declared legally that the employees can work after 65 years of age. Sometimes to impose the punishment the employers may ask the employees to retire early. The employee must serve the employers for minimum 10 years which can help him in providing the pension. A compulsory retirement plan has been obsolete in today challenging business environment because organizations need every age group employees who can contribute their skills and knowledge at workplace to grow their business. It should be justified by the employer when they are retiring the employees before 65 years of age. Employers have to deal with a new approach and implement new working practices. Thus removal of compulsory retirement age has got its own advantage and disadvantage related with the growth of business.

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