retirement packages

GladGradDad
Tue, 29 Oct 2013 17:47:20 +0000

Some people are going to take the offer and some are going to refuse.

ZM - I guess I interpreted the word as ‘refuse’ in your post but even with ‘refuse’ there’s usually little they can do - if the company wants them gone then they’ll be gone, either with the package or without it.

I think oftentimes ‘the package’ includes some legal language, i.e. it’s a contract, whereby the person accepting it agrees to not sue the company over the termination - especially for age discrimination. If they later decide to sue, which of course they can still do if they want to, they then need to return the money specified in the termination package since they’ve now broken the contract. This package is generally put in place to both protect the company and appease the terminated employee.

As to whether refusing the package will be to their benefit, it’s hard to say and it depends on the company’s intentions. There are some companies that will offer an ‘early retirement package’ and some people will take it and some won’t but the people who don’t simply stay with the company and there are no ramifications - i.e. in a large company the company offers it and perhaps 100 people take the company up on it but 500 people in the same age category don’t - the company’s happy it had the 100 person reduction and the people who accepted it are happy because it’s a heck of a lot better than just giving one’s 2 week notice for when they were going to retire anyway.

But I’ve also seen ‘packages’ offered to people who were going to be terminated regardless in which case the legal contract and incentive aspect applies. But in these cases a company has to be very careful they don’t discriminate based on age, which might be easy to do in this situation, again, hence the offer of the package.

If this is a true early retirement package then there shouldn’t be anything negative happening to the people who refuse the package but if the company’s intent is to really be rid of the people under this cover, then those people will probably ultimately be let go anyway, whether they accept the package or not.

I know someone who accepted a termination package a couple of times - terminated (he volunteered for it), got the package (a pretty decent one), got rehired later, then terminated again (volunteered again), and got the package again. This was unusual but that worked out well for him.

I’m hoping I’ll get offered a package when I’m about ready to retire.