The labour market is becoming increasingly competitive. Technology, in turn, is changing rapidly. Older employees can quickly find themselves on the sidelines.
The employee approaching retirement age may be less motivated. His or her performance may start to fall short. Health or behavioural problems can also be a factor, which can lead an employer to terminate the employment contract. However, such a dismissal can be problematic.
Duty of care
By law, the employer is obliged to protect the personality of his employees. He has a greater duty of care towards employees who are close to retirement and have worked for him for a long time.
Dismissal without further action of an older employee with a long service may be considered unfair. This also applies if the quality of the work or the motivation of the employee is unsatisfactory.
Continuing to work beyond retirement age
Willingness to remain active during retirement or economic necessity, some employees wish to continue working after reaching retirement age. If the employer wishes to terminate the employment contract automatically at the age of 65 for men and 64 for women, this must be expressly agreed in advance.
New employment contract
If the employee continues to work during retirement, account must be taken of his or her age and health, which may become impaired. It is in the interest of both the employer and the employee to provide for shorter periods of leave in order to facilitate resignation or dismissal.
Occupational pension scheme
Despite his or her gainful employment, the employee will receive his or her AVS pension from the age of retirement, i.e. 65 years for men and 64 years for women. Whether the employee will receive his second pillar pension at retirement age or whether he can ask for it to be postponed depends on the pension fund to which he is affiliated.
In principle, an employee who continues to work after retirement age is not exempt from paying all social security contributions. However, the amount of the salary on which these contributions are paid changes.
Loss of earnings insurance
Older people are more likely to fall ill or have an accident. Some loss of earnings insurance policies limit or cancel their cover from a certain age, usually retirement age. In such a case, if there is no insurance, the employer will have to pay his salary if he is unable to work for a certain period.