Insights On Advantages And Disadvantages Of Hiring Retired Staff - CiteHR
Dinesh Divekar
Business Mentor, Consultant And Trainer
Loginmiraclelogistics & Management) Pg
Nagarkar Vinayak L
Hr And Employee Relations Consultant
+1 Other

Cite.Co is a repository of information created by your industry peers and experienced seniors sharing their experience and insights.
Join Us and help by adding your inputs. Contributions From Other Members Follow Below...
Dear Friends,
We have a policy of providing employment after retirement on consultant basis for the retired employees. as an honorary gesture to their services at mutual terms however, we need insights on advantages and disadvantages from fellow mentors as we are reviewing the policy.
Also, Whether these appointees, should get benefits at par with regular employees? what are different industry practices?
Your advises are truly appreciated and valued.

Dear Shweta,

Have you confused between the "employee" and "consultant"? Definition of employee is a worker who is hired to perform a job whereas definition of consultant is an expert who gives advice. How can a person be employee and consultant, both at a time?

Employees are paid to do certain quantum of work in given span of time with defined accuracy. In contrast, consultant provide consulting or advisory services based on their experience, industry contacts, market knowledge etc.

Coming to query of rehiring employee after retirement. As long as person is able to meet the performance targets of his/her job, hiring or rehiring after retirement does not matter. Therefore, I recommend you looking at the ability to meet the performance targets and nothing else.

As stated earlier, retired employees are fit for advisory roles. They are more suitable for jobs like drafting the contracts, vetting the contracts, devising policies, negotiations etc. They may not be given skill based jobs. After 55, faculties of many persons slow down, though they remain intellectually sharp.

Retired persons may not be that techno-savvy. Juniors who are habituated with WA or FB, may find them boring to deal with oldies. Make sure that juniors are not frustrated with the old ways of the retired personnel.


Dinesh Divekar

Dear Shweta,

To look at it, there is always the other side of the coin. We have experienced instances that retired employees no less enthusiastic than the fresher, be it latest applications or imparting knowledge. Many of freshers seen as short of knowledge in their academic line and luke warm in seeking and gaining the required information in their execution. This sort of mental state in them irks the seniors most resulting more work load to the seniors including those reengaged retirees. Ofcourse one cannot compare the utility of freshers with the retired, unfair. But the age is only in numbers. It is misplaced to generalise once retired he/she becomes slow down and lethargic. It is possible persons suffering certain ailments at retirement tend to underprepared to continue that much work load but definitely not in majority. Backed by the enormous wealth of knowledge and work ethics there is no reason to undermine their utility for the good of any establishment. In the same breadth it’s unjust to pay them less. Many organisations used to extend the services beyond the superannuation with the same terms and conditions. Ofcourse, subject to one’s policy provides for such an arrangement. I have come across persons are retained thus by paying them more as well. Excepting the disadvantage of ‘he/she’ snatches employment opportunity of young job seekers who could be bread winners to their families, I don’t find anything wrong in reengaging them in cases of dire need which is always there. Better not look down upon them just because they are available for retention, why not more since they would turnout more than expected (even unexpected things too as they could visualize in advance than you would using their past experience) Ofcourse the compensation package and methodology would vary from person to person depending on various factors.

Thank you Dinesh and Kumar! The points made are well taken. Apart from remuneration, can they be given equal benefits as of employees? Such leave, Bonus , Insurance etc..
For consultants bonus and others benefits cannot be directly paid. If those are paid they are to be treated as employees. Apart from that they cannot be taxed as normal employees. For consultants, TDS is to be calculated as per section 194 J of income tax act
Mahesh HMM

Nothing prohibits granting them leave, bonus or exgratia, pickup & drop, medical facilities(health insurance), even gratuity & PF. There is no impediment legally to grant them. However for operational reasons you might, if unavoidable, they could be given a break in service for obvious reasons. There is no compulsion they could only be retained as Consultants, but can be appointed or extended on contract basis either with consolidated package or with other defined perks. It is possible. What's wrong if they are called an 'employee' after all they are expected to do employee's job. Let's call the spade as spade. There are several instances in govt. departments, scientists, technocrats, IA/IPS officers and so, what's blocking when it comes to private cos.?

Not all retired persons can bring wealth of knowledge and experience which can add value to the business.They should be engaged selectively based on organisation's pressing needs and specialized knowledge and experience. Therefore the policy of reengaging them as consultants regardless of above considerations may be beneficial to the person but perhaps not to the organization. As some retired persons may be fit enough to work , it may not be prudent to use them on full time basis in the role of advisers/mentors or to tackle some emerging specialised task/s.They can be hired on the part-time, temporary or on assignment basis with flat /fixed remuneration considering the value to the work they bring in. It is better not to treat them on par with the regular staff for service conditions but treated as 'specialied category' based on their knowledge and experience.Their remuneration will differ from case to case and no 'one fit for all' formula may work.




Thank You Mr. Mahesh, Mr. Kumar, Mr. Nagarkar for your valuable inputs.
This discussion thread is closed. If you want to continue this discussion or have a follow up question, please post it on the network.
Add the url of this thread if you want to cite this discussion.

About Us Advertise Contact Us
Privacy Policy Disclaimer Terms Of Service

All rights reserved @ 2020 Cite.Co™