At least in the U.S., adjustments in many institutions could be encouraged and accelerated by the establishment in federal law of a legally-protected right to phased retirement. Such a law could supersede and require changes in many of the existing laws & programs affecting retirement, changes that otherwise would likely take decades if they occurred at all.
The challenge
Increases in longevity and in the healthiness of seniors will require adjustments in many, many institutions. Since businesses, governments and other institutions adjust in widely varying ways and on widely varying timetables, it’s not at all surprising that the quality of responses to increases in longevity and health also vary widely. Nonetheless, the fact that work rules, retirement plans, health care, and housing – to name just a few important institutions – are neither reconsidered nor coordinated will keep millions from having access to what many view as the ideal way to mature in the workforce. Most people do not want to “retire” in the sense of stopping working all at once and never working again. Phased retirement would be useful for many people, but not unless and until work rules, workplaces, benefits and other institutions support it.
A proposal
Congress could enact legislation specifying either (a) that working individuals had the right, but not the obligation, to work half their previous time for the five-year period after reaching the age of 65, and/or (b) that denial by an employer of such a work arrangement would create a rebuttable presumption of age discrimination. The legislation would include provisions pre-empting contrary provisions of law and authorizing federal agencies to interpret labor, employee benefit, and other laws to conform to the new requirement. The legislation would itself have phased implementation (e.g., implementation for large firms in 3 years and for smaller firms and non-profits in 6 years).
How might businesses respond?
Businesses would necessarily over some period evaluate changes in workplaces and job design, as well as in the design of employee benefits. Since access to phased retirement would provide a safe harbor, many more firms would develop programs than currently do.
How might government respond?
A potential benefit of such an approach would be to force rethinking of employee benefit and workplace laws by government. Historically, federal agencies have declined to exercise administrative discretion unless legally required to do so (and, even then, often only very slowly). Creation of an individual right and supersession of employee benefit and other laws could provide both an incentive and legal fora to spur agency rethinking.
Implementation issues & challenges
There are dozens: Would/could/should a requirement apply to the independent contractors of the “gig economy”? As federal agency funds are diminishing, how would agencies find the wherewithal to rethink their various rules and regulations?
