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More Companies Phasing Out Retirement Option

NEW YORK—With pension funds dwindling as retirees enjoy longer, more capable lives, many businesses have opted to freeze their workers' employment status and keep them on the job through their sunset years.

"Under the new approach, our employees gain the advantage of lifelong job security," Hewlett-Packard CEO and president Mark Hurd said. "Even though our workers will no longer be able to collect a pension, they will receive checks as long as they are able to be wheeled into work and punch the clock."

Hewlett-Packard, Verizon, and IBM are just a few of the Fortune 500 companies that are phasing out the retirement option in favor of "indefinite-employment" plans, under which thousands of qualified workers will continue to earn yearly stipends in exchange for work.

"To the list of outmoded and costly business practices such as health insurance, overtime pay, and lunch breaks, add age-based quitting," corporate management consultant Robert Hopgood said. "Post-retirement-age labor is great for companies, and it's a great way for seniors to stay active."

American companies are following the model set by General Electric, which in the 1970s began requiring departing employees to give 45 years' notice.

Although the paradigm shift is highly admired among cost-conscious managers in the business world, employees question its practicality.

"I don't need to support my family anymore," said 93-year-old Alfred Nuzzo, who has worked as a products inspector for GE's small-appliance division for 68 years. "I have a dead wife and three dead kids."

Multitasking while dying on the job can take its toll. GE customer-service representative Esther Fischbeck, 88, is juggling career, widowhood, and early-stage Alzheimer's disease.

Supervisor Gladys Schiele, 93, inspects the work of data-entry clerk Jack Vandenbogen, 87.

"What is this?" said Fischbeck, clawing at her phone headset. "When do I go home?"

Responding to critics who say that phasing out retirement shows a lack of concern for workers, IBM CEO Samuel Palmisano argued that if companies didn't care about their elderly employees, they would not keep them on the payroll.

"We frequently honor their birthdays with celebrations, and our going-away parties are always respectful and appropriately somber affairs," Palmisano said. "IBM is like a family—you don't leave a family."

Lawrence Babbio Jr., president of Verizon, defended his company's newly enstated non-retirement plan.

"We believe in our workers," Babbio said. "Everyone is valuable and has something to offer, and we're not going to phase them out just because they only have a few years left to live. Even vegetative employees can serve the company by donating valuable, hard-to-find organs to our younger executives. And our comatose employees are very useful as product testers."

Saying that an older person in a wheelchair "shouldn't be pushed into a corner, but in front of a desk," Hewlett-Packard's Hurd said lifetime employment will make his company more inclusive.

"There's a place at our organization for everyone—the young, the old, the mentally incapacitated, the moribund," Hurd said. "All we ask of them is to work a regular 40-hour shift and honor our 'no mercy killing' policy."

He added, "We pride ourselves on the fact that, even after death, our employees can continue to contribute to the company's growth. In an uncertain world, we offer real job security—from training to the grave."

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