'We tend to treat older workers as a homogeneous group, when they're not… there is so much potential in that cohort,' says Australian lecturer
Recently, the Australian government unveiled the updated framework for the Superannuation Guarantee (SG) charge ahead of its payday super implementation in 2026.
The SG charge comes when employers fail to pay contributions in full and on time.
Details on the government's reforms were released ahead of the government's mandate to make employers pay for their employees' super on payday in July 2026.
The new changes will strengthen the country's superannuation system and deliver a "more dignified retirement" to Australian workers, according to Treasurer Jim Chalmers.
Australians are retiring later, according to the Australian Institute of Health and Welfare. In the 20 years leading up to April 2021, the workforce participation rate of older Australians more than doubled (from 6.1% in 2001 to 15% in 2021)
But the transition from earning a wage to “living the dream” isn’t often discussed in workplaces. The superannuation providers that have invested the wages of workers for more than 30 years are only allowed to advise members about the financial possibilities of transitioning to retirement.
The social and emotional repercussions – which can be heavy – are mostly decided over kitchen tables. So, how can employers do better?
HR teams risk losing valuable resources if they fail to prepare staff for retirement, said Dr Sanjee Perera, a senior lecturer at UniSA Business at the University of South Australia.
“An organisation can suddenly realize, ‘Oh, in the next 10 years, 25% of our people become eligible for retirement… We haven’t paid much attention to older workers and sometimes we don’t collect enough information about them.’”
Objective advice can be hard to find. HR departments should anticipate retirement trends and encourage early, open-ended conversations between line managers and employees.
“A lot of times, those conversations don’t happen,” Perera said. “It’s just assumed that someone is going to be 65, 67 when they retire. But it’s not necessarily the case. You could have a 55-year-old who’s thinking they want to slow down and retire when they’re 67; but you could also have a 55-year-old who’s thinking about their next adventure [in a different role].”
A worker who’s done pretty much the same thing in an organisation for 30-odd years might be happy to go sideways and try something different.
“We tend to treat older workers as a homogeneous group, when they’re not,” she said. “There is a lot of diversity.”
The odds can feel stacked against older workers who are trying to gear a career change. Recruiters tend to pigeonhole them into their past career. If they applied a little more imagination, they would see the older cohort has transferable skills.
“Sometimes, people stay in jobs because they’ve tried to find alternatives but didn’t have any success,” said Perera. “That’s an issue. But a teacher, for example, may have a set of transferable skills; they know how to mentor people, to give feedback in a constructive way. Those skills are probably useful in other professions, in other occupations.”
If a worker wants to stay within an organisation, a manager shouldn’t necessarily come to a conversation about transition expecting pleas for promotion.
“We have to be more creative and tap into that human capital,” she said. “We have to ask, ‘Do they have some transferable skills that allow them to move into other roles?’ That would be great, as opposed to seeing talent walk out the door.”
If retirement is managed with little thought, a departed worker can suffer a dramatic sense of identity loss. Social networks that have been cultivated for decades can suddenly disintegrate, Perera said.
“You’ve lost that purpose,” she said. “How do you prepare for that?”
Retirement research shows that people who have planned for retirement are more likely to be satisfied with retirement afterwards.
Employers who handle retirement well, including a fond farewell, can benefit when that talent comes back for valuable consultancy and contract work, Perera said, “as opposed to an abrupt retirement.”
Perera has found line managers can be reluctant to talk about retirement. Will they come across as ageist? Will the worker feel as though they’re being targeted? The trick is to keep conversations open-ended, she said.
Managers can also get nervous and jump to conclusions.
“We’ve had employees say, ‘I asked my manager whether I could do a nine-day fortnight, and they started immediately giving me information about the retirement process,’ when that was not their plan at all,” Perera said.
A rational chat about the future can include changes to how work could be designed, about fitness for the role – or other roles – and different kinds of support to enable work to continue.
“They are really important things that need to happen, but they don’t necessarily happen in a lot of organisations,” she said.
Questions about retirement usually pop up around the early-to-mid-60s, but who’s to say the topic can’t be broached 10 years earlier? It could be as simple as asking: “What are you thinking about for the next 10 years? Is there any way we can help you?” Perera said.
“They might tell you they’re thinking of slowing down and eventually retiring, or tell you that they are looking for something different now,” she said. “There is so much potential in that cohort.”
