Not Everyone 60 And Older Can Afford To Retire


People have been living longer than previous generations, which probes the question of whether 60 is a sufficient retirement age. However, not everyone has the option to retire and still require a steady income for their survival.



A 2019 case, in which an employee was dismissed from their job because they had reached the retirement age, has sparked debate around whether or not an employee can be fairly dismissed based on their age, specifically relating to retirement.

South Africa's Labor Relations Act allows employers to dismiss employees on grounds of age if they have reached the normal or an agreed retirement age. The normal retirement age is currently 60 - 65 years old. 

In the abovementioned case, the Labour Court found that since the employee had already reached the retirement age of 60 (as stipulated per his employment contract, which he entered into in 2008) at the time of his dismissal in January/February 2019, section 187(2)(b) applied and therefore, the employee’s dismissal was fair. 

Continuing to work for years after 2008, in January 2019, the employee was informed in writing that his contract would be terminated with effect from 12 February as he had reached retirement age. 

Section 187(2)(b) of the Labour Relations Act (LRA), states that an employer can fairly terminate the services of an employee at any stage after the retirement age has been reached.

The court noted that this provision provides a framework for employment opportunities for younger South Africans, especially in a country that is plagued by record levels of youth unemployment, said legal experts at Cliffe Dekker Hofmeyr.

“Consequently, the Labour Court dismissed the employee’s claim and further held that the argument that the parties “tacitly” entered into a new employment contract when the employee continued to render his services beyond the age of retirement would “have no traction”,” said Cliffe Dekker Hofmeyr. 

In the past, those who have reached the retirement age would (without hesitation) leave their place of employment to enjoy the fruits of their labour along with their pension; however, in recent years, the debate around whether those 60 and above should be allowed to continue to work has arisen.

With the cost of living being so high, some people (despite having already worked for a number of years) still have to receive some form of income to make ends meet. Sometimes retirement is a distant reality, even though they are entitled to rest. 

Martin Pienaar, the chief operations officer at the digital skills academy at Mindworx, says that in large corporates, there seems to be a culture where people over 60 are forced to retire irrespective of whether or not they have enough funds to do so.

Of course, as the world continues to progress, the skills requirements also change. If those who choose to stay within the labour force wish to continue at their place of employment or find somewhere new to work, they will have to adapt. 

"There are lots of ways of keeping skills up-to-date, using online courses and online universities, so there is no excuse for people to not leverage their skills," says Pienaar.

Pienaar adds that people over 60 should be given the flexibility to decide whether or not they would like to continue working. The flip side though, is whether their health and skill levels allow them to do so. 

"It has to be flexible because people that want to carry on working beyond the age of 60 or can’t afford to retire at that age need to look at their skills… Are their health and energy in good shape," explains Pienaar. 





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