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Heck No, We Won’t Go! Is “Forced Retirement” OK?


An article in the Wall Street Journal this week tells the story of 68-year-old Norway resident Karin Johansen, an insurance adviser whose company tried to force her retire. “Depressed” by the idea, Johansen fought back, taking the case all the way to the Norwegian Supreme Court.  But the court sided with her employer, Norwegian insurance company Gjensidige, and Johansen was forced into a “mandatory retirement.”  It’s a situation, the Journal says, that’s happening across Europe.  But for those of us in the U.S., is there anything to worry about?

The answer: It depends.

For the most part, U.S. companies do not — and legally cannot — force you to retire based on your age. But there are a number of exceptions. State and local police and firefighters typically must retire between the ages of 55 and 65, air traffic controllers at 56 and commercial airline pilots at 65. These occupations have mandatory retirement ages, “primarily for ensuring their safe and effective conduct,” writes Jagadeesh Gokhale, a senior fellow at the Cato Institute, a nonprofit public policy research institute.

Many U.S. law firms also force partners out at a certain age. A report by the American Bar Association found that mandatory retirement policies for partners existed in 57% of law firms with 100 or more lawyers. The reason law firms (and companies) can do this is because of a loophole in the age discrimination laws that exempts some high-level, well-paid senior executives from the mandatory retirement protections. But this may soon change: The Equal Employment Opportunity Commission has sued at least two law firms in recent years accusing them of discriminating against older partners with policies like these, but these policies still haven’t been eradicated from all firms.

Most workers, however, won’t ever encounter a “mandatory retirement” policy since.  Still, that doesn’t mean companies aren’t sometimes trying to force out older workers — even though there isn’t an “on paper” policy.  Age discrimination claims have increased 61% over the past decade, according to the EEOC.  And with a tight job market and more workers postponing retirement, experts say, aging at in the workplace may only get harder.

Readers, what do you think?  Is “mandatory retirement” OK?


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About Encore

  • Encore examines the changing nature of retirement, from new rules and guidelines for financial security to the shifting identities and priorities of today’s retirees. The blog also explores news that affects retirement, from the Wall Street Journal Digital Network and around the web. Lead bloggers are reporter Catey Hill and senior editor Jeremy Olshan. Other contributors include The Wall Street Journal’s retirement columnists Glenn Ruffenach and Anne Tergesen; the Director for the Center for Retirement Research at Boston College, Alicia Munnell; and the Director of Research for Pinnacle Advisory Group, Michael Kitces, CFP.