Some employers might believe that older workers automatically become less productive as they age or are otherwise unqualified for a position. For this reason, they might force employees to retire when they reach a certain age. In reality, many older workers remain qualified and productive well beyond the typical retirement age (about 65), and forcing them to retire usually constitutes illegal age discrimination.
Employers can’t base mandatory retirement on the terms of insurance or retirement plans, on the costs of hiring and retaining older employees, or on a seniority system. Of course, as with most laws, there are exceptions to this general rule.
Who Can Be Forced to Retire?
- Executives: Employers can force employees who are 65 years or older to retire if they were in a “bona fide executive or a high policymaking position” for a two-year period immediately before retirement. This exemption only applies if the individual is entitled to an immediate retirement benefit from a pension, profit-sharing, savings, or deferred compensation plan worth a total of at least $44,000. Also, this exemption typically only applies to high-level executives, not middle managers or supervisors.
- Tenured Professors: Institutions of higher education may require involuntary retirement of tenured faculty who have reached age 70.
- Firefighters and Law Enforcement: Cities, counties, and states are allowed to force firefighters and law enforcement officers to retire at an age established by local or state law. However, these employers must have job performance evaluations that allow older workers to demonstrate physical fitness to qualify for continued employment.
- Bona Fide Occupational Qualification: employers may force older workers to retire if they can show that age is a “bona fide occupational qualification” and that individuals of that age possess a trait that prevents safe and efficient job performance, and the only way to ascertain the trait is by age.
What about Early Retirement Incentives?
Employers may also offer voluntary early retirement incentives to older workers so long as the program doesn’t disadvantage them. For example, employers can offer incentives to older employees and not younger employees, and they can base the incentives on years of service or salary calculations that are analytically distinct from age; however, employers can’t threaten older workers with termination, demotion, or reduced pay if they reject the financial incentives.