swamisyal
One group company is being merged with the company to which I\'m heading. Retirement age in that company was 58 yrs, while in my company it is 60 yrs. Should we fix it 58 or 60 as a result of merger? Will there be a legal issue if the retirement age is reduced from 60 to 58?
From India, Mumbai
saiconsult
1899

It all depends up on the terms of merger. If the agreement of meger says that the employees of the company that was merged into your company are governed by the service conditions of your company, then thier retirement age will be 60 years.
B.Saikumar
HR & labour law advisor
Mumbai

From India, Mumbai
swamisyal
Dear Mr B.Saikumar
Thanks for the advice. As per the agreement, all the existing benefits of the employees of the merged company are to be secured. That means to them, keeping it 58 wouldn't be objectionable but in order to bring uniformity in both the units, either we keep it 58 or 60. Increase in retirement age for the employees of the merged company would be enjoyable but if we reduce it from 60 to 58 for our employees, there could be resistance. The Board is in favor of keeping the retirement age as 58 yrs if there is no legal issue in reducing it. What should I do?

From India, Mumbai
winnerhr
Dear Swami, Please take the expert legal opinion, before proposing anything to management.IT will not be only an legal but also an IR Issue.
From India, Mumbai
saiconsult
1899

Mr.Swamy
what I understand is as per the agreement of merger, all the benefits, hither to admissible to the employees in the organisation that was merged into your's, need to be protected. It means you need to maintain status quo with regard to their benefits. In this context, please let me know whether the terms of agreement of merger were accepted by the employees/union.If accepted, you can retain their retirement age at 58 years and they cannot agitate over this issue as you have not done any thing that adversely affects their service conditions and you have complied with the terms of agreement which was accepted by them.If not, it is advisable to fix their retireement age at 60 years on par with the employee off yoour company.
B.SAikumar
Mumbai

From India, Mumbai
M.J.SUBRAMANYAM
24

Hi Swamy,
I think Mr. Saikumar has dealt with the issue with clarity it deserves. There are two companies which are getting married. Employees of one company retire at the age of 60 years and other at 58 years. Let the benefit of retirement go to the second company, where the retirement age was earlier 58 years. If the age is reduced from 60 years to 58 years without the consent of the employees of first company, they will be at a disadvantage. Hence the opposite course of action would be advisible, i.e., make the retirement age of the company to be 60 years for all. There will be no labour problems. Second company employees, who get a bonus of two years benefit, can be asked to put in their best foot forward to make the new company highly profitable.
M.J. SUBRAMANYAM, BANGALORE

From India, Bangalore
swamisyal
Thanks to all for your valuable advices which I received very much in time as today was the last day I was supposed to take decision. I fixed it at 60. Regards. Swami
From India, Mumbai
harshadaamin@gmail.com
company A gave an appointment letter to all its employees containing a retirement age of 55 years as per existing co. policy or accordingly to co. policy as it may change from time to time. Later Co. A started retiring its employees at the age of 58. One dept of company A was hived off to form a new co, co. B. Co. B did not give new appointment letters to such transferred employees of co. A but assured continuity of service at same terms and conditions as there was in Co. A. Co. B in the appointment letters given to new employees specified the retirement age of 58. Can co. B force employees transferred from co. A to retire at 55 since their appointment letter says so ?
Request you to please ans ASAP
Thanks & Regards
Harshada

From India, Thane
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