When an employee retires

Ill-health related retirement

If you run an occupational pension scheme and one of its members has been off work due to ill health and is unlikely to return to work, they may be able to retire early if it is provided for in the scheme rules. 

There are certain steps you can take to ensure that this facility is not abused and that individuals are treated fairly.

You should consider:

• whether there is a reasonable expectation that the employee will be able to work again before the normal retirement age of the scheme
• whether there are any "reasonable adjustments" you could make to their usual working arrangements that would enable them to return to work 
• whether a medical examination would help in making a decision - employees have the right to refuse a medical examination but refusal could be justification for ill-health retirement being declined

If ill-health retirement is appropriate, agree a retirement date with your employee that will give sufficient time for him or her to prepare. Keep a record of actions taken during all stages of the procedure.

Subjects covered in this guide

• Introduction
• Retirement - the process to follow
• Pensions and retirement
• Providing support for a retiring employee
• Ill-health related retirement
• Early retirement

 

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