Eliminating Barriers for Older Workers to Stay in the Workforce

To prevent projected dramatic declines in the workforce following the retirement of the Baby Boomer Generation, Senators Herb Kohl (D-WI), chair of the Senate Special Committee on Aging; Gordon Smith (R-OR), ranking member of the committee; and Kent Conrad (D-ND) have introduced the “Incentives for Older Workers Act” to provide incentives and eliminate barriers for older Americans who want to stay in the workforce longer, and encourage employers to recruit and retain older workers.

In proposing the bill, Senator Smith stated, “A colossal demographic shift is on the horizon. Retiring baby boomers will cause significant gaps in our workforce if we do not incentivize them to work longer. We need to ensure the door stays open for those willing and able to remain an active part of the workforce during their golden years.”

Senator Kohl added that the pressures of the upcoming retirement wave will require that employers adopt policies to attract and retain older workers. Said Senator Kohl, “Our common sense policy creates a win-win situation for both older workers and the companies that employ them.”
Greeter
The framers of this legislation intend for it to confront the changing face of retirement. Research indicates that the divide between working and retirement is no longer as clear-cut as it once was. Due to changing economic conditions, many older workers face the necessity of staying on the job longer, and employers often want older, more experienced workers to stay. Senator Conrad said, “What we offer in the Incentives for Older Workers Act would make sure older employees who want to cut back their work schedules won't lose pension benefits as a result."

A 2007 Conference Board study reports that current retirement trends could create a U.S. labor shortage of 4.8 million workers in 10 years. The “Incentives for Older Workers Act” works to reduce this decline by:

removing penalties in certain pension plans for workers who phase into retirement.
allowing seniors who continue to work beyond retirement age to earn Social Security credits until age 72.
reducing the amount of Social Security benefits lost to seniors who claim benefits before reaching normal retirement age and while they continue working.
making older workers eligible for the Work Opportunity Tax Credit.
clarifying that certain defined benefit pension plans can define normal retirement age as the earlier of a specified age or 30+ years of service.

For the full text of the bill, see here http://frwebgate.access.gpo.gov.