Vol. 51, No. 6
As retirement parties for baby boomers become more common, employers should think throughand adopt some standards for these observances
Esther Riel fondly recalls her retirement party last year from privately owned Globe Manufacturing Co. of Pittsfield, N.H. Sitting in a new recliner, clutching flowers from the company’s owners and waiting for four huge cakes to be served, Riel was regaled by management and co-workers. Her gifts included the recliner, which the company later moved to her home, a set of luggage for a planned trip to Montana, birthstone jewelry and cash.
“They do [retirement parties] for everybody, so I knew what was coming,” Riel says, referring to her 22-year career with the company, where she spent most of her time sewing pockets on coats. “They go out of their way,” she says, adding, “I have a friend who worked for 38 years at a library in Massachusetts, and they did nothing for her when she retired.”
The manufacturer of protective equipment for firefighters and emergency workers may be unusual in that it has a written policy regarding retirements, notes HR manager Gayle E. Troy, SPHR. For retiring employees with 10 or more years of service, the company purchases gifts and/or gives cash equal to $100 for each year of service. So at Riel’s going-away gala, she received gifts and cash valued at $2,200.
Troy and her HR staff query a retiring employee’s co-workers, family and others for gift ideas to make each party special. “When I first started here, there were a lot of people ready to retire,” Troy says. “After three or four of them, I determined we needed a policy, and $100 a year seemed like a nice compromise.” One to three Globe employees retire each year.
Troy admits that what works at Globe Manufacturing, with 387 employees in Pittsfield and 49 at a second location in Ada, Okla., might not work at other companies.
“Our celebrations cost very little, except for the gift itself,” she says. “The personal touch throughout the process makes all the difference.”
Retirement celebrations will become increasingly common as the baby boom generation nears its golden years. Holding appropriate send-offs for these milestones may become an important morale builder for employees rapidly approaching their own retirement.
For most workers, however, the era of one career-long employer is long gone. Mergers, acquisitions, consolidations, downsizings, rightsizings and waves of start-up companies have muddied what was once a clear employment landscape, creating a more mobile workforce that often expects to change jobs several times over a career.
For this reason, retirement parties are “a bit of a dinosaur,” says Bob Nelson, president and founder of Nelson Motivation Inc., based in San Diego. “Stable, predictable employment in stable, predictable industries just doesn’t happen anymore,” says Nelson, author of 1001 Ways to Reward Employees (Work- man, 2005).
At most employers, integrating new employees into a company and its culture while rewarding efforts that propel the business are the current focus, Nelson says. “In terms of meaning and motivation, the here and now are much more important—thanking employees for what they’ve done and achieved and focusing less on how long they’ve been with the company,” he says.
Yet Nelson agrees that, at companies with retirement party traditions, those events still resonate with longtime employees who have yet to leave the workforce. “Are you going to stop with the next one?” he asks. “If done right, retirement parties add meaning and context to someone’s career with the firm—and that’s powerful stuff.”
Many organizations take a personal approach to planning employee retirement parties, but rarely are celebration policies codified outside of government and university settings.
“Retirements aren’t one of our big deals. But when it happens, it’s handled on a local basis by the local management group,” says Dave Quint, SPHR, HR director at JRN Inc., a Columbia, Tenn.-based franchisee of 165 fast-food restaurants. The company employs 3,800 workers in 10 states. “We’re in the quick-serve restaurant business, and we usually don’t have a lot of long-term people.” Ninety percent of JRN’s franchises are for KFC Corp., which Quint notes also has no formalized guidelines.
But Quint recalls that one of his former employers, a family-owned lumber company in Indiana, made a big deal out of retirements, holding an annual dinner for all of its retirees and their spouses.
Robin Bond, SPHR, an attorney and president of Transition Strategies LLC in Wayne, Pa., once worked at Allegheny General Hospital in Pittsburgh and still remembers the two-hour cookie-and-punch receptions held for retiring employees. Co-workers would stop by for five or 10 minutes to greet the retiree and enjoy refreshments before heading back to work.
“I personally looked forward to that, thinking that it would be me someday,” says Bond, whose company specializes in employment law. “How expensive can cookies and punch be? [Retirement parties] create a sense of employees being valued and send a message to the rest of the organization that they’re valued and cherished. It’s a nice touch.”
In her practice, Bond has noticed that fewer of her clients offer even token retirement parties or recognize significant service anniversaries. One reason, she believes, is that companies are leaner than they used to be, with no one responsible for planning such events. However, events still occur, mainly on an ad hoc basis, with the retiree’s peers chipping in for a gift, paying for a catered lunch or staging a potluck affair.
City College of San Francisco has both formal and ad hoc retirement events, including an annual chancellor’s party for faculty, administrators and classified employees sponsored by the faculty association. Martha Lucey, dean of marketing and public information, calls the event “semi-official.” Faculty and administrators with 20 or more years of service to the college receive a captain’s chair or rocking chair with the college logo, and those with fewer years of service receive a crystal apple with an inscription.
Faculty and staff often are feted at department events, and some retirees who have made notable contributions are recognized at the board of trustees level, Lucey says. Recently retired art instructor and Art Department Chair Roger L. Baird, for example, had a revolving exhibit gallery renamed in his honor by the trustees.
Jacquelyn Green, a Spanish instructor and chair of the Foreign Language Department who retired in 2003 after 37 years at the college, has her chair “in a prominent place in my living room. It’s very comfortable,” she adds. The Foreign Language Department also treated her to a “huge and spectacular affair” in the greenroom of a local theater. Attendees included Chancellor Philip R. Day Jr. and several trustees, Green recalls.
The consolidated luncheon or reception for retirees, traditionally held in May, hasn’t always enjoyed administration sanction, and Green credits Day for his support and assistance. “The event has very good feelings around it and is presented in a very upbeat way,” she says. “It’s clear that [current employees in attendance] are just as much in love with the college as the people who are retiring.”
And that’s why retirement parties remain deeply imbedded in the fabric of many companies. Even impromptu affairs can elicit feelings of warmth and camaraderie among employees, says Brian J. Sands, recognition consultant for MTM Recognition of Annapolis, Md., which designs employee award and incentive programs.
Many companies create personalized collages that represent the worker’s tenure at the company intermingled with significant events in the company’s history. Sands recalls the retirement of a hospital cafeteria cook after nearly 50 years on the job. Four former CEOs who had run the hospital during her career wrote her notes, and she “felt like a superstar” at her luncheon, Sands says.
“The key is to treat everyone equally on the basis of tenure, not performance or title. That’s our philosophy,” Sands says, “but most companies don’t think that way.”
Equity a Concern
Establishing a policy that ensures equitable observances of retirements is smart not only from an employee relations standpoint but from a legal standpoint as well. Companies that don’t treat employees equitably can be subject to discrimination claims, says Heather Gatley, executive vice president of HR services and general counsel at AlphaStaff Group Inc., a Fort Lauderdale, Fla.-based HR outsourcing company that provides training, benefits, compliance and HR counsel to hundreds of companies with more than 20,000 employees nationwide.
She recommends that larger companies have written rules to be consistent in treatment of employees. Smaller companies probably don’t need to be so diligent, but the HR director should monitor what occurs on an ad hoc basis.
“Written policies are always a good idea,” adds Sarah A. Kelly, an attorney in the Labor and Employment Law Group at the Cozen O’Connor law practice in Philadelphia. “Smaller employers might think it’s overkill, but it depends on the size and complexity of the company.”
In general, it is OK to have a retirement party for someone leaving the company voluntarily, as long as everyone in similar circumstances is eligible for a party. If the event is company-sponsored, the company should take the same care it does with holiday parties and other events, being cognizant of the potential liability around serving alcohol and the consequences of sexual harassment or other inappropriate behavior, Kelly says.
“Managers should realize that behavior has the same consequences at an off-site event as it does in the office,” Kelly says. However, the attorney adds that potential liability should not be an overriding reason to bar retirement parties.
Even considering the hassle that planning a retirement party can represent, the benefits to morale far outweigh the time and company resources expended on the effort, says Troy. At Globe Manufacturing, the HR department handles each event, including the purchase of personalized gifts.
For retirees, a send-off party can put a punctuation mark on a fulfilling career.
Globe “has so many longtime workers because they like it there,” says Riel, 73. “I could have retired at 62 or 65, but I chose not to. I enjoyed working there.”
Riel’s words are like music to Troy’s ears, affirmation that the HR department’s hard work is paying real dividends in longevity and employee loyalty.
“Planning retirement parties seems so simple, so straightforward, and, in reality, it is,” says Troy. “It’s not rocket science.”
Matt Bolch is an Atlanta-based freelance writer who has been a business journalist for two decades.