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Continuing to Work After Retirement Age

By: Garry Crystal - Updated: 17 Jun 2013 | comments*Discuss
Continuing Work Retirement Employment

In Britain around 10% of people over the state pension age are still in employment, and there are around 6 millions people between the age of 50 and retirement age still actively employed. These figures show that for many people, working instead of retirement is a desirable option and not just for financial reasons.

More and more people are continuing to work after retirement age for a variety of reasons. No doubt for a large number the main reason for working after retirement age will be financial, but for others achieving a balance between work and home life is an important issue. Some people do actually view the prospect of stopping work altogether as a scary option and many will ease their way into retirement by continuing to work but with more flexible or part-time hours.

Your Right to Work

Regulations in Britain mean that an employer cannot discriminate against workers on the grounds of age. These regulations were brought into effect in 2006 in order that older people have the same rights to employment, training and adult education. It is unlawful for an employer to use age as a reason for discrimination on the following points:-

  • Deny someone training
  • Prevent promotion
  • Dismiss someone from their employment
  • Deny employment to someone
  • Retire someone before the state employment age or the company’s own retirement age without a valid reason
However, an employer still has the right to refuse someone over the age of 65 or over said employer’s usual company retirement age, and they do not need to give any reasons or justifications.

Working and Your State Pension

If you are continuing to work after retirement age then you can either claim your pension or defer it. If you choose to take your pension later then you may be able to get a higher rate of pension later on, or you may be able to take the deferred amount as a lump sum. The lump sum will be taxable but will have added interest and then you can begin receiving your normal pension. If you are considering either of these options then you will need to delay claiming your pension for at least five weeks in order to receive the higher rate. For the lump sum you will need to delay for at least 12 consecutive months.

Already Claiming a State Pension

If you are already claiming a pension and then start work, you can cancel your pension and then restart it again when you finish work. You can only cancel your pension once, and receiving either a higher pension rate or the lump sum will be dependant on the amount of time you have cancelled for. Your state pension will increase every year you defer your claim. You should also check with your company pension advisor regarding the regulations on claiming the company pension if you continue to work after retirement age.

Rights and Older Workers

As an older worker you have the same rights as any other employee, although there may be a few restrictions. You will be entitled to the national minimum wage. Restrictions for older workers may include no rights to statutory sick pay or statutory redundancy pay. For any employee rights issues you should contact the Department of Trade and Industry (DTI) or the Department of Works and Pensions (DWP).

Finding Work

There are endless possibilities for older workers when it comes to finding employment. Many older employees wrongly assume that they will be passed over in favour of younger employees but this is not always the case. Some employers look favourably on older workers due to their reliability, skills, and the fact that they take less sick time than younger employees.

There are government schemes specifically designed to help older people find employment such as New Deal 50 Plus and New Deal for Disabled People. These schemes are designed to help older people who are finding it difficult to obtain employment or finding employment that pays a decent wage. Job-sharing is also an excellent way of working part-time or working to more flexible hours; you can always ask your employer if they would consider flexible hours.

Voluntary Work

Voluntary work is an excellent option if you are considering continuing to work after retirement age. Although usually unpaid, you can gain valuable new skills, and some volunteer jobs will pay tax free expenses or reimburse your expenses. Volunteer jobs can include working for the Citizens Advice Bureau (CAB), working in tourist information offices and charity shops, volunteer drivers, or you can even become a local councillor.

Continuing to work after retirement is a popular and beneficial choice for many older workers. The retirement age is only a guideline when it comes to work there is no reason why you cannot work long past retirement age if you are healthy and able to.

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I am 53.5 years of age have no pension. Is it worth joining nhs pension for remainder of working life. I will possibly be working past retirement age.
silky - 17-Jun-13 @ 11:23 AM
If I defer taking state pension for 5 years, and opt to take the full amount (+interest) in one lump sum, is the lump sum taxed as part of the financial year in which I receive the money, or is the tax spread over the 5 years of deferral ? I think the 40% tax burden may be higher than if I take it in one lump sum.
Bubbles - 10-Jul-12 @ 1:15 PM
The article is very informative and easy to understand. However my husband and I are 72 and 68 respectively and have been on yearly contracts since turning 65 years old. One contract to end on14thOctober 2011 and one to end on 27th April 2012. What will happen when the contracts end. Do we still need to apply three months ahead to continue to work. Should we be given new contracts that show no end date. Many thanks for any relevant information you can give or let me know where to get the best information from
Mazda - 27-May-11 @ 7:20 PM
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