Only employee can make early retirement call (Legal View)

Incentives are not discriminatory, though how they’re presented might be a problem
By Ashley Brown
|Canadian HR Reporter|Last Updated: 01/14/2013

Although mandatory retirement was abolished in Ontario in 2006 — and is no longer in effect in most other jurisdictions in Canada — it is still permissible to use an appropriately formulated early retirement incentive to “encourage” the voluntary departure of an older worker.

From an employer’s perspective, an early retirement incentive program can be a useful tool to downsize or revitalize a workplace. It can help reduce the staff complement, cut costs, re-organize operations and allow more recently educated employees to make their way up the workplace ladder — all without having to resort to more disruptive measures such as terminations or layoffs.

Employees often welcome early retirement. Yet, despite inherent advantages, early retirement incentives have received their share of criticism.