WASHINGTON - A recent survey by the Wyatt Co. found a significant majority of employers offering early retirement do achieve their primary goal - a smaller work force.
Eighty-one percent of the 388 defined benefit plan sponsors surveyed that offered early retirement windows between 1991 and 1993 reached their downsizing targets because of their programs. Of those companies, 6% offered multiple early retirement windows over the same period.
In order to "sweeten" early retirement benefits, the Washington-based consulting firm found 58% of companies surveyed granted employees additional service credits and 36% offered supplemental benefits to provide a bridge until an employee became eligible for Social Security benefits. A majority of companies (66%) offered a combination of incentives to promote early retirement: 46%, for instance, provided both extra age and service credits. Some employers offered further incentives, including a cash severance payment (46%), enhanced retiree medical benefits (29%), and continued life insurance coverage (15%).
Fifty-six percent of employers helped workers to decide whether to take advantage of an early retirement window by providing counseling services. Financial planning seminars were offered by 41% of respondents, and one-on-one counseling was provided by 27% of companies. Early retirement counseling is still apparently very much a "human" function: Only 5% of companies made computer-assisted financial planning packages available to employees.