General

Employee retirement Te tāoki kaimahi

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Most employees will want to retire at some point. Preparing your business for employee retirement supports your employees who are approaching retirement age, encourages loyalty and productivity, and reduce disruptions to your workflows.

Retirement ages

There is no specific retirement age in New Zealand, apart from a very few exceptions (such as non-New Zealand aircraft crew).

This means your staff can keep working as long as they like. The only reason you can ever ask someone to retire is if:

  • their employment agreement was created before 1 April 1992
  • their employment agreement specifically states a retirement age as a clause
  • you and the employee both agreed in writing to confirm or change that retirement age on or after 1 April 1992.

You can’t try to force someone to stop working for you because of their age. If you do, they could file a personal grievance against you.

Ways to approach employee retirement

If you haven’t already developed company procedures about retirement, these are two common ways to approach it.

Phased retirement

With this more typical approach, you reduce staff workload over a period of time. This allows retiring staff to ease into retirement, and you can transfer their knowledge across the business.

Early retirement

Early retirement allows employees to retire whenever they are emotionally and financially prepared for it. This is a good approach if you want to encourage succession and clear internal promotion blockages.

Employee retirement process

  1. Step01

    Your employee tells you they want to retire

    This could be a difficult time for your employee. If appropriate you could offer them a phased retirement approach or the chance to attend a pre-retirement course. 

    You should also point them to Inland Revenue for information about retirement.

    Getting KiwiSaverInland Revenue
  2. Step02

    Check their employment agreement

    Make sure the employee has given you as much notice as they need to. If they offer to give more notice than required, you can accept, but you can’t try to make them give more than the minimum. If you do, you could face a personal grievance case.

  3. Step03

    Confirm their retirement in writing

    Give your employee a letter to confirm their retirement, with details including:

    • the date
    • confirmation of the notice period.

    You can also thank them for their service to the company and wish them well with their future plans. Make sure you include a copy of this letter in your employee’s file.

    Record keeping
  4. Step04

    Prepare for their departure

    Complete the employee exit checklist to make sure you’ve done everything you need to do.

    Employee exit checklist

LAST REVIEWED: 16th July 2025

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Ending employment