Know your retirement age rights
Some people prefer to retire at an early age while others choose to work for as long as possible. Whatever your preference, you need to know what your rights and options are.
No one can force you to retire. You're allowed to work for as long as you like and no one is allowed to discriminate against you because of your age.
But should you feel like you're ready to leave the workforce and enjoy your golden years, here are some of the things you need to know before packing up and going on retirement. You and your employer should however agree on a retirement age.
There are 3 possible situations that you could find yourself in:
- Your employment contract requires you to retire at a certain age.
- You've agreed with your employer on a retirement age or there's a company norm.
- There's no mention of retirement in your contract and there's no agreement.
If you sign an employment contract that stipulates a retirement age, then you can legally be required to retire at that age. The organisation won't be required to give you notice.
If the retirement age isn't in the contract but is agreed or if there is an organisational norm, then the employer can give you notice requiring you to retire at that age. The notice period will be the same as the notice period for termination of employment set out in your contract of employment.
When would there be deemed to be an organisational norm? There's a general understanding that the "normal" retirement age is 55, 60 or 65 but this understanding is too vague to be useful in specific instances. Indications of the organisation's norm can be found in:
- the rules of a company's provident or pension fund (but this isn't definitive), or
- company policy.
If there's no mention of a retirement age in your contract and there's no organisational norm, then you can continue to work until you're unable to do your job properly. Your employer can only terminate your contract in accordance with the labour legislation (that's for misconduct, operational requirements or incompetence) and will have to follow the procedures set out in your contract and labour law. The courts have found that it's unfair discrimination for your employer to terminate your employment services just because of your age.
For more information on the law around dismissals, see the Department of Labour's guide to the Labour Relations Act called "Know Your LRA".
What if you continue to work after the retirement age?
There's no legal certainty regarding the rights of an employee who works beyond retirement age. It's thus advisable for the employer and employee to clearly define the terms of employment after the retirement age, for example how long the employee will continue to work for and what notice is required to terminate the employment.
Where can you get an income from after retirement?
After you retire you'll usually rely on a pension or provident fund for your income.
You can either draw a state pension or you can contribute to a private pension fund or provident fund. For detailed information on how private provident funds and pension funds work visit the Black Sash and ETU paralegal advice website.