Bcarya
Senior Hr Executive
Naziyasm@gmail.com
Hr & Compliance Incharge
Aankit Anand
Hr-executive
Lakshmi87*
Agm - Hro, Compensation & Benefit Mgt,
Manhar_shweta
Recruitment Executive
K_gopal53
Hr Manager
+8 Others

Dear Seniors,
The retirement age for an employee in our company is 58 years.
Two of our employees will attain 58 years next year, as per company policy a person retires at the age of 58 years & we have to prepare his settlement & close his account. Can i reappoint a retired employee on regular rolls for full time.
13th November 2013 From India, Bangalore
It is advisable to hire the employee as consultant/contract then rehiring on roll, the reason behind is that the company policy states to prepare the final settlement and close his account and you are contradicting the policy, so being the HR and compliance Incharge if you do, which shows a wrong signal to the other employees. A HR guy is a policy maker and not a policy changer.
This is my view, let other seniors also give their views.
13th November 2013 From India, Ahmadabad
Dear MUBASHIRA,
I am totally agree with the views of Mr. Saji.
As you have mentioned yourself that your company policy is that if a person attends the age of 58 years then he / she got retired. It clearly means that after that age, an employee cannot be a regular employee of the company, if he / she can, then what is the benefit of Retirement Policy..?? So, question of reappoint of a retired employee on regular rolls is not possible.
This is a general situation which basically faced in industry. So, the best solution of this is, you can appoint these type of employees on yearly contract basis and they should be paid accordingly. By this way, you can utilize their experience and services with your organization.
13th November 2013 From India, Delhi
There is nothing wrong in reappointing the employee on retirement. Except that you will have to settle his account and appoint him agains with necessary documents. Only thing is you must be satisfied rather the management must be satisfied taht due to his reappointment the company is benefited. You must substantiate this point. I can tell you the advantages of reappointing the retired employee.
1. cost of the employee is less.
2. workwise he will be same and you can get the work done
3. The company is not committed as anytime he can be discharged from the service.
4. Since he is an old employee you can expect the same loyalty, sincerity etc rather than a new employee.
5. Old employee knows very well about the company and you can rely on them.
13th November 2013 From India, Madras
Dear all,
Thanks for all your suggestions Seniors.
Dear Saji,
Am not contradicting i have just posted my query for suggestions, I know being HR & Compliance Incharge what is my responsibility i don't want to set a wrong example or contradict with any law,i have posted my query for advise from you seniors. Am not changing any policy or deviating from any policy.
14th November 2013 From India, Bangalore
Dear Seniors, If i appoint them as Consultant or on Contract, What about PF,EDLI & Gratuity do i have to enroll them for these benefits or not.
14th November 2013 From India, Bangalore
Dear MUBASHIRA, If you appoint such employees as Consultant or on Contractual Appointment, then EPF, EDLI or Gratuity will be not applicable on such appointment. But, let come more comments on this.
14th November 2013 From India, Delhi
In my view, you can simply continue him by issuing an extension letter. No Act stops you and I don\'t see any malpractice in it.
Because as long as Employee is mentally and physically fit to perform you can continue him/her as an Employee.
14th November 2013 From India, Delhi
Hi
company hire a retired employee as retainer or consultant and give his support and expertise in running the business and for the servicws rendered he will submit bills and finance may deduct IT accordingly. As consultant he is not eligible for any statutory benefits.
14th November 2013 From India, Hyderabad
Dear Naziyasm,
You can go with what fellow members have said, like appointing the retired employee as consultant or on contract, even you can also rehire him on your rolls as well, because there is no law for private companies where any age limit is mentioned for retirement, you can give that particular employee an extension of services, even you can do full & final settlement of that employee and then rehire him by changing the clause of retirement in the appointment letter, as generally most of the appointment letter carries a clause of retirement with mentioned age of retirement you may change that age in the appointment letter.
Regards
Ashutosh
14th November 2013 From India, Kollam
No.You can utilise his services,if he is willing, under any contract on temporary basis.He will get wages as per terms of the contract.After 58 years , his final dues have to be settled.But,on subsequent employment on contract basis,statutory deductions like PF, can be made in a different A/C.
15th November 2013 From India, Bokaro
Hi,
Normally, companies when rehire the services of a retiring employee, treat him as a Consultant or employee on contract basis. The contract period may vary depending upon the company\'s requirement of his services, his performance/ contribution, health of the employee, etc. Generally, it is on an annual contract basis, renewable at the discretion of the company.
With regard to the advantages of re-employing a retired employee, while there are many advantage as mentioned by the contributing member \'Launchpad\', there is also one glaring disadvantage of not able to bring in newness in the workings /systems.
S. Dass
15th November 2013 From India, Bangalore
Dear Mubashira,

While others have responded to your query, let me add my thoughts as well.

The Policy of your Company is that employees must retire at the age of 58 years. However, it is the desire of the Company to re-employ the person after formal retirement takes place.

There is no statutory requirement for retirement, as far as private companies are concerned. You are free to decide either way (re-employ the person or retain the person as a consultant) and also change the age of retirement as is felt appropriate.

My suggestion is the following:

1. Let the retirement take place, followed by the full and final settlement in the normal course.

2. It is preferable (as suggested by several others already) to retain (not re-employ) the person as a consultant. This would provide continuity and benefit of knowledge that the individual brings to the table. I would not suggest that he be re-employed as an employee, since (apart from having to change the policy) this could be cited as a precedent by others who may retire later and seek re-employment. On the other hand a company is free to appoint anyone as a Consultant - it will not be possible to cite this as a precedent.

3. Regarding the allowances that would have been payable to the employee during his employment period (PF, EDLI, Gratuity etc), you could take a Cost to Company approach i.e., gross up all the allowances payable as a part of salary and pay the person the grossed up amount as consultancy fees. This would make sure that while the individual is no worse off financially but also retains the flexibility to invest the surplus funds in instruments of their choice. Since a consultant is not an employee, the benefits like PF / Gratuity etc would not be payable.

I hope this would help you in arriving at an appropriate decision.

Regards

Raju Bhatnagar
15th November 2013 From India, Bangalore
Dear Fellows,
Retired employees who are re-engaged are called Third Age Employees. If you think taking a third age employee has become necessary in the current circumstance, then consider the employee who has just retired. if he gives consent, then you can re-engage him on contract or part time basis. Note that third age employees are experienced and can push Companies ahead of their competitors.
15th November 2013 From Ghana
to all my seniors over here...i just want to ask a question further to this.
What will be the scale of PF,ESI for that said employee who has either joined back as consultant or re joined as a employee.
Will the old scale when he was employed continue in its calculations of PF, ESI
20th November 2013 From India, New Delhi
Hi
PF , ESI , Gratuity, Bonus need not be applied to consultants as they r have already received under regular employment.
while fixing their consultation fee his last CTC may be considered for fixing monthly fee ie CTC/12 , then his part of PF , Gratuity, Bonus are taken care in monthly fee. The IT for consultants would be 10% + service tax (if the contracts exceeds for more than 6 months).
20th November 2013 From India, Hyderabad
Dear Members
By reading all your conversations
1.The retired employee cant be enrolled on rolls.
2.As per the company policy he has to retire
3.You can appoint him as a consultant by deducting 10% as a professional fee.
4.He can utilise the company services and he is not eligible for EPF, EDIL
5.As retire employee you can give some facilities like medical,transport
with regards
Siva Sai Gopal.Komma
MosMetro India Pvt Ltd,
Chennai Metro Rail Project
Chennai
22nd November 2013 From India, Chennai
Dear friend
There is no wrong in re-appointment of a retired person on tenure basis or on contract basis. Even Government is also appointing so many Retired senior Officers, even IAS and IPS to various posts in the Government utilizing their services in public interest. Yours is a company established under certain Law and Acts. You can modify your policy taking into account the need of the experts in your company, and re-appoint the experts after retirement in the interest of the company. But they cannot be given regular time scale of pay. They can be accommodated on consolidated salary on temporary basis.
23rd November 2013 From Canada, Calgary
Dear Manpreet Chawla,
Retired Employees can be retained as consultant / or as retainer. There is no hitch in engaging these assets to you organization.
An agreement between your company and the Consultant can be executed under the The Contract Act 1872.
This is safest way to reward good outgoing member, asset.
This will build strong bonding amongst your manpower professionals.
Thanks
V K Sharma
HR,
Tarapur
4th February 2014 From India, Vasai
As per the policy of the Company, the retirement age is 58 years. Every employee of your company shall retire on attaining the age of 58 years as per rules of the Company. If you want to re-appoint any employee after retirement, your company has to take a policy decision to re-employment of such of the employees by paying some honorarium or any consolidated salary depending upon the requirements of the personnel in the company. There may not be any objection. However, you can settle all the retirement benefits to such employees as per your company rules. When once he retired from your company on attaining the age of superannuation, he cannot be appointed as a regular employee again, but if there is need for such person in your company, you can appoint him on contract basis or honorarium bass for a tenure period of one or two years depending upon the situation.
16th August 2014 From Canada, Calgary
Hello everybody,
Taking this discussion ahead... would like to get your ideas too pls...
The talk has been about how to extend the tenure of retired employees.... have them as consultants or re employ them?
On the other hand, what if we hire retirees(external) in our organisation as consultant / for that matter any employee hired in a particular function as a consultant at the time of inception in the co..., but no appointment letters issued to that effect..
In the above case, during increments, would it be logical to issue increment letters to them, as they have been given increment in accordance to the hike pattern followed in the company ? ( Have not issued any formal letter to them as yet)
Similarly,what about salary slips? Do we issue the same to them as the other employees?
8th July 2016
Dear all ,
Does" Reappointment in the same status as prior to Retirement' , means holding the same post after retirement. Will the subordinates in the same cadre gets effected if there promotion is due .
Please can anybody clarify.
Priya
3rd February 2017 From India, Gurgaon
Hello seniors ,
Please any one send me the as per law or factory act . Retainer ship act after retirement if we retain a employee on roll . What deduction will deduct :
PF
ESIC
ETC.
PLEASE SEND ME AS PER FACTORY ACT RULE
MY EMAIL ID IS :

2nd August 2018
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