Everyone
Retirement
When an employee retires, the process is generally the same as when they resign. An employer cannot force an employee to retire, except in specific circumstances.
Employee and employer responsibilities
| If you're an employee | If you're an employer |
|---|---|
| When you retire, you need to follow the process for resigning. | You cannot force an employee to retire, except in specific circumstances, for example, medical retirement. |
| Phased retirement can allow you to ease into your retirement and pass on your skills. | Phased retirement can give you time to prepare and reduce disruption to the workflow. |
When employees retire
There is no set age for retirement – but the common age to do so is 65, as this is when New Zealanders qualify for superannuation.
When an employee decides to retire, they will need to follow the normal process for resigning, and give notice to their employer.
An employer cannot force an employee to retire, except in specific circumstances outlined below. If an employer does force an employee to retire, and the situation is not covered by one of these exceptions, the employee can challenge it by raising a personal grievance, or a discrimination claim with the Human Rights Commission.
Human Rights Commission(external link)
It’s a good idea for employees and employers to have a plan to manage upcoming retirement. Flexible working or progressively reduced workloads (phased retirement) can support this.
Exceptions to the retirement age rule
An employer cannot discriminate against an employee because of their age. This means that, generally, an employer cannot make an employee retire. However, there are some exceptions to this rule.
Employment agreement before 1 April 1992
Some Employment agreements contain the terms and conditions of employment. Every employee must have a written employment agreement outlining the terms and conditions of employment. ‘Employment agreement’ has a broader meaning that includes all other documents and other agreements forming part of the contractual agreement between the employee and employer.
Other exceptions
Other exceptions to the retirement age rule are:
- occupations for which the retirement age is set out in legislation, such as coroners and judges
- where being a particular age or in a particular age group is a genuine occupational qualification for the employment – for example, some foreign countries prohibit pilots-in-command aged above 60 years from operating certain aircraft. In this situation, it may be justifiable for an airline to establish a policy which prohibits those over 60 from holding that position. If an employer wishes to rely on this exception, they should establish a policy to this effect and include it in the employment agreement
- certain occupations including:
- non-New Zealand crews of ships and aircrafts
- domestic employment in a private household
- certain work performed outside of New Zealand.
These exceptions do not apply if an employer can make changes (that do not involve unreasonable disruption) to their business so that another employee can do the duties impacted by the exception.
If an employer does force an employee to retire, and the situation is not covered by one of the exceptions, then the forced retirement can be challenged by raising a personal grievance or a complaint of age discrimination through the Human Rights Commission.
Before an employee leaves
When an employee finally ends their employment, there are actions to be taken, such as calculating their final pay and collecting company property.