How pre-retirement courses can ease employee departures

The abolition of the default retirement age will necessitate a widespread change of attitude towards the termination of employment for older workers. We examine how pre-retirement courses can help ease the strain.

Key points

  • Pre-retirement courses were offered to employees by 35% of employers in the 2010 XpertHR retirement procedures survey.
  • Some courses only cover financial information, while others include a broader focus that encourages employees to think positively about their retirement goals and to plan ahead.
  • Pre-retirement courses can improve employee engagement, help inform on issues such as partial retirement and pensions and can also ease the dialogue around retirement between employee and employer.
  • Accompanying XpertHR case studies reveal how a pre-retirement course has helped change attitudes towards retirement among employees at BT and how a longstanding three-day programme provided by the Natural Environment Research Council is considered a premium benefit.

Pre-retirement courses were offered to older employees by 35% of employers as part of pre-retirement support, according to XpertHR's 2010 retirement procedures survey. This feature examines the value of these courses, while our accompanying case studies look at how they are used at two organisations.

Pre-retirement support for employees

 
 

Although the financial aspects of the courses are important, the 'lifestyle' element can be even more valuable.

 

Increasingly, employers offer support to employees as they approach retirement to help them wind down from full-time work and make the transition to a different lifestyle. Options can vary from reduced hours to partial retirement tied in with flexible pension provision. Our survey in this area of 189 organisations found that half (51%) offer specific support to employees in the period leading up to retirement.

Another important part of pre-retirement support is appropriate communication with employees. Whether it is done through advice sessions with HR, private conversations with the line manager, or access to financial advice or counselling, organisations can ensure that employees are as clear as possible about their retirement options.

As part of this communication process, a pre-retirement course can not only provide a chance to pass on information about the organisation's retirement policies and pensions, it can also help to prepare employees for the process itself and for everyday life after paid work.

Box 1: Related XpertHR case studies

  • The majority of BT employees used to retire at the age of 60 on a full pension. However, a change in pension age from 60 to 65 in 2009 and the introduction of a part-time (or "winding-down" option) has added flexibility to the retirement proposition. BT's Planning for Retirement course has helped its employees understand the growing complexities surrounding their retirement options, with a strong focus on their pension.
  • At the Natural Environment Research Council, the company has provided a three-day residential course for employees in the run-up to their retirement since 2000. With a broad focus on both financial and lifestyle aspects of retirement, the course is seen by employees as a premium benefit.

What is a pre-retirement course?

Pre-retirement courses can take a variety of forms. Many financial firms or independent financial advisers provide seminars for employees, which focus primarily on the financial aspects of retirement planning.

Other courses, such as those offered by Laterlife Learning and Life Academy (external websites), also cover lifestyle planning and are delivered in an interactive style during one- or two-day workshops. These providers both run "open" courses at various locations throughout the year, to which employers can send individual employees. They also provide in-house courses, which can be adapted to the needs of the organisation (see example in box 2).

Although the financial aspects of the courses are important, the "lifestyle" element can be even more valuable. This is especially the case for people who are closer to retirement as the lifestyle aspect of the training can increase understanding about the general implications of retirement and encourage attendees to take stock of their personal goals. Ultimately, the courses can assist people in making the best choices for themselves and enjoying a fulfilling life after work.

 
 

If the organisation does want to have a dialogue with them about retirement it is even more important that the individual is able to approach discussions from a factual rather than an emotional point of view.

Tony Clack,
director,
Laterlife Learning

 

Why offer a pre-retirement course?

Over the past few decades, employers have traditionally offered pre-retirement courses as part of the employment package to boost and sustain a healthy employment relationship, and increase staff motivation and morale.

Tony Clack, director of Laterlife Learning, which has run courses since 2003, explains that the training can make it easier for employers to have a logical conversation with employees about their retirement.

"A lot of people approaching retirement are concerned about it," he explains. "They view it emotionally. If the employer raises it they may see it as a threat. Equally, if the employee brings it up, the employer may see it as a sign they are not behind the development of their career.

"There has been a problem with this kind of conversation, and that will become harder now that the procedure around the default retirement age has been removed."

A well-presented pre-retirement course can help employees to take a rational view. Commonly, it will also give them a more positive attitude towards retirement, as they realise what opportunities it brings, and can remove some of the reluctance to leave employment.

"With the forthcoming demise of the default retirement age, the organisation won't be able to retire [employees], so if the organisation does want to have a dialogue with them about retirement it is even more important that the individual is able to approach discussions from a factual rather than an emotional point of view and fully understand the opportunities that retirement presents for them," says Clack.

Box 2: Doosan Power Systems broadens views on retirement

Doosan Power Systems (external website), producer of boiler and steam turbines, has been offering access to Laterlife Learning pre-retirement courses since 2007 to employees aged between 63 and 65 years old. More than 30 members of staff have attended a course during that period, and a further 20 will attend two more in-house programmes scheduled for 2011. Although in-house courses are more cost-effective for the company, employees who are unable to attend one of these sessions can elect to go to one of the provider's open courses.

The company chose to offer pre-retirement courses because many employees approaching the company's retirement age were nervous about the impact of retirement and unsure what actions they should be considering with regard to finances. The sessions have helped establish a workforce that feels happier about the prospect of retirement, as employees broaden their views on life after work and learn from each others' experiences.

A member of the HR team at Doosan Power Systems believes that it is even more relevant now that the default retirement age is being phased out. "Many employees don't know how to plan for retirement and have not thought fully about what they wish to do," she says. "The course allows them to see what is available to them and that life does actually continue beyond working."