Can I be fired after announcing my retirement?

Retirement is an activity that is usually perceived as a relief, a triumph. Several years of hard work and you have finally made the choice to retire. But what happens when your employer does not react the way you thought he/she would? The question is in the mind of many employees: Am I going to get fired once I declare the news of my retirement? The answer is yes – but it will depend on what type of employment you have and how your company policy works and at what time of the year. We all should know how this works and what you can do to ensure your rights are not violated.

Knowing the Relationship between Retirement and Termination

Retirement is a personal choice of an employee to quit employment, usually upon the attainment of some age or years of service. But, telling your employer that you are going to retire does not mean that your job will be completely secure until your final day.

The employment in most of the countries is based on the principle of at-will employment. This implies that your employer may fire you whenever he or she feels like either with or without an excuse provided it is not based on discrimination or retaliation. And so though you have already notified of your retirement, technically it is possible that your employer terminates your employment prematurely, although it may not always be fair or ethical.

The Reasons Employers can terminate employment prematurely

Although this can be heard to be cruel, there are various reasons why an employer would choose to part ways with an employee before they have announced their retirement date:

Rebuilding of business or finances:

Even after a company has given retirement notice, your company might be subjected to layoffs or restructuring and therefore you might find yourself in a situation where you are a part of the process of the downsizing.

Problems with performance or misconduct:

In the event that your performance drops or a problem occurs at the workplace in your last few months, your employer might decide to terminate your job prematurely.

Operational convenience:

In other instances, organisations would like to hire new employees earlier, particularly when your retirement date is long term and the position has to be filled urgently.

Policy conflicts:

In some organizations, there are very stringent regulations regarding the notice periods or transition which departing without doing them properly may lead to difficulties.

Although these motives might sound quite rational in the perspective of an employer, it should be made sure that there is no discrimination or retaliation.

Can an Employer Fire You After Retirement Announcement Without Penalty?

Yes – in most instances, an employer is able to. But there are legal limits that guard the employees against unfair treatment. Your discriminatory reasons that include age, gender, race, and health condition are not the reasons that an employer can dismiss you.

As an example, when you are dismissed by your employer simply because you are approaching retirement age, that would be considered age discrimination which is prohibited in most areas by law such as the Age Discrimination in Employment Act (ADEA) in the United States.

When you suspect that your employer has unfairly or discriminately decided to avoid you once you have announced your retirement, then you have legal grounds to complain or seek compensation.

What to Do When Retiring to Stay Safe?

To secure your post and perks, you can do several things in case you are close to retirement:

Give Proper Notice

You should always give a written notice about your retirement plan. The length of notice is subject to company policy – two-three weeks to three months. Written notice aids in recording your decision, and this may be misunderstood in the future.

Understand Company Policy

Consider the retirement and resignation procedures of your organization before announcing your resignation. There exist employers who will provide the retirement packages or transition programs and may have rigid notice procedures.

Secure Your Benefits

Check your eligibility of retirement benefits like pensions, withdrawals of 401 (k) or even medical cover. Make sure that you have completed all the paper work and have made copies.

Maintain Professionalism

Work as long as you can professionally till the final day. You should not fight or experience a decline in performance because that may provide your employer with the excuse to terminate your employment at a young age.

Document Everything

Document everything about your retirement, including e-mails, HR meetings and any verbal commitments. Such documents would come in handy in case of conflicts in future.

What Will Your Benefits Do if You Are Terminated Before Retirement?

Announcing retirement can or may not have an impact on your benefits whether you are fired or not, depending upon the policies of your company and the cause of your firing.

Pension plans: When you are already vested in your pension, being laid-off will not normally impact on your right. But you will get what you have deserved.

401(k) or retirement savings: This would be considered as your account and therefore you retain them no matter the fact whether you are working or not.

Health insurance: Health insurance that is sponsored by the employer is normally terminated after you have been laid off. You are however eligible to COBRA or private insurance.

Severance: It is also possible that your employers will pay severance, particularly when you were not fired because of misconduct.

You should always consult your HR handbook to clarify any issues with your benefits department.

Can You Take Legal Action If Fired After Announcing Retirement?

There are legal alternatives available to you in case you feel that you have been wrongfully terminated. The following are just some of the typical situations in which legal action can be used:

Discrimination: Laid off due to old age or ageing.

Retaliation: Fired due to the exercise of a legal right, e.g. the filing of a complaint.

Breach of contract: Employer breached contract as regards to your retirement or benefits.

In this event, it is better to consult a labor lawyer or make a complaint to your local labor department.

Did you read this Blog? Is $5 Million Enough to Retire at 60? Smart Retirement Planning Guide

Final Thoughts

Retirement is to be announced as a good move to the next stage of your life. Nonetheless, it is important to know your rights. Although employers have the right to fire you once you declare that you are retiring, they should not do so on the ground of unfairness or discrimination.

It is always good to defend your benefits, use the official procedures and maintain the professionalism of communication. In the event of early termination, which is not justified, seek the help of a legal professional to protect your retirement livelihood and contentment.