Q. Are there any specific rules defining “early out” retirement packages offered to employees? Our company is planning to offer early outs. Our criteria mandate that an employee must have worked for us for at least 15 years and be at least 50 years old. But we have employees who have worked as long as 28 years who fail to meet the 50-year-old criterion. Is this age discrimination in a reverse sort of way?
A. It is permissible to structure early retirement programs to provide a minimum combination of years of service and age. As you point out, any discrimination would be against younger employees, not older ones, and that discrimination would not be actionable in Pennsylvania.
It’s important to offer early retirement programs on a voluntary basis to avoid claims that you are forcing employees to retire. You should consult with counsel to make sure the program you design complies with applicable laws.