Older workers and Benefit Plans: An Assessment

Benefits and Challenges of Hiring Older Workers

Older workers can have an advantage over an organization due to their consistency and maturity in decision-making. They are perceived to have low rates of absenteeism compared to younger employees (“Employment Programs,” n.d.). According to “Employment Programs,” (n.d.), older workers demonstrate positive labor ethics since they have already developed a stable career. Employers save time, energy, and resources for capacity enhancement for such employees since they are viewed as experienced and resourceful. “Employment Programs,” (n.d.) reveals that customers are more receptive to recommendations made by such workers. When businesses that interact with clients hire older employees, they enhance trust in their products and services. Although organizations consider older workers as weary and unproductive, age diversity in the workplace can improve performance, hence the need to integrate the aging workforce.

Older employees have systemic limitations that can affect an organization’s operations. “Employment Programs,” (n.d.) illustrates that this group has limited exposure to technology and the digital innovations that revolutionize modern business. In addition, older workers are susceptible to sickness and have reduced energy. Hence, they cannot manage certain operations. Such incidences make employers limit the hiring of aging personnel.

Social Security Benefits

Social security benefits are essential in sustaining workers after retirement. The Social Security Act of 1925 established an old age benefits program and unemployment insurance to support workers (“Income Program,” n.d.). The three categories include retirement, disability, and dependents or survivor benefits (“Income Program,” n.d.). Employees are eligible for old age benefits at 62 years when they qualify for early retirement. “Income Program,” (n.d.) illustrates that for a worker to be eligible to receive disability benefits, either a physical or mental impairment should limit the capability to gainful employment. Additionally, the disability must have lasted 12 months or resulted in death. The benefits sustain employees willing to retire early and work throughout their legal retirement age to live a dignified life.

Social benefit schemes support employees who age in the workplace or encounter accidents leading to disabilities. For dependents and survivor benefits, employees should accumulate credits to qualify for either individual retirement earnings or disability accruals (“Income Program,” n.d.). Workers are paid a monthly retirement package depending on their contributions and retirement age. For instance, employees who retired at full age in 2017 earn around $1371 a month. Accordingly, workers benefit from disability schemes either directly or through their spouses and children, depending on the level of disability or mental impairments. Thus, survivor benefits are paid to dependents, such as children or spouses, every month. Comprehensive social benefit schemes add value to the lives of older employees and support them to manage their retirement years with self-respect.

Compare and Contrast Pension Schemes


Defined Benefit

  • The scheme pays yearly benefits to retirees.
  • The scheme provides retirees with consistent monthly income flows from retirement to death.
  • The employer bears the risk to ensure the promised benefits are paid to the retiree
  • The employee does not participate in the contribution plan (“Income Program,” n.d.).
Defined Contribution

  • These schemes have specified employee and employer contributions but provide a limited guarantee of benefits.
  • The funds are accumulated in investment accounts, and the returns from the reserves determine the rate of paybacks.
  • Employees invest the contributions (“Income Program,” n.d.).


Private Sector Employers and Older Workers

Many countries experience an increase in the number of older workers. Integrating such employees with younger personnel is an important aspect of enhancing balance in organizations. According to Peterson (2018), private companies employ flexible working schedules as incentives for older individuals to continue working. The author reveals that part-time arrangements, seasonal employment, consultation services, and reduced job responsibilities are some of the strategies implemented by the private sector to attract the aging workforce.

For instance, CVS, a global pharmaceutical provider, encourages older personnel to work during the spring and summer seasons in New York and then transfer to Florida during fall and winter. Such programs provide work incentives for aging employees due to weather fluctuations, which significantly affect their operations. Quinn, Cahill, and Giandrea (2018) aver that employers provide progressive programs such as reduction in working hours and bridge employment systems where older personnel are allowed to work with a different employer after retiring. Such incentives enhance the integration of the aging workforce and lead to improved performance.



Employment programs. (n.d.).

Income programs. (n.d.).

Petersen, J. S. (2018). Employment policies to increase the labor force participation of older workers. Members-only Library, 20-28.

Quinn, J. F., Cahill, K. E., & Giandrea, M. D. (2018). Transitions from career employment among public-and private-sector workers (NBER Working Paper No. 25003). Cambridge, MA: National Bureau of Economic Research. Retrieved from https://www.nber.org/papers/w25003.pdf

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