A checklist for companies

The retirement of an employee from a company must be such that the employee leaves the company with satisfaction. The employee needs to be thanked for his/her services and contribution to the company.

It is often a good idea to have a closure interview with the employee where his/her view of the career and the company is reviewed and where the employee is given the opportunity to air his/her views of the company and explain the scope for improvements.  

The employee has the right to work on his/her normal tasks to the end of the notice period, although it is possible to negotiate otherwise. If an employer does not wish for the employee to work throughout his/her period of notice, he must still pay the wage equivalent to the notice period.

It should be kept in mind that it is advisable to consult with the employee as to when he or she would wish to retire. The general rule is to give notice to people due to age when an employee reaches 70 years at the end of the next month thereafter. This applies in particular to public employees, whereas private companies have flexibility in this matter and generally base retirement on the calendar year and naturally in consultation with the employee. Care must be taken to let the notice be in accordance with laws and wage agreements, as many older employees have a longer contractual period of notice than three months.

An employer must pay accumulated and unpaid vacation pay, and this is most often done at the end of the notice period. At the end of employment, the employer must also pay the vacation and December supplement in accordance with the period of employment and employment proportion during the year, and this is most often done at the time of settlement of final wages or at the time when such payments are usually made, but this can differ from one wage agreement to another.

Many larger companies offer their employees a course in retirement from employment.

In many instances, employers make retirement easier with adjustments, such as a reduction in the employment proportion, shorter working hours, longer vacations with a spread in payments or by other means. Experience shows that employees who prepare for their retirement well and remain even longer on the job than their age indicates are happier in life.