Partial Retirement: Transition towards Retirement

Transitioning to retirement can be a challenge for many employees. The sudden shift from a busy work life to being free all day every day can come with its difficulties. At the same time, employers grapple with a shortage of skilled workers and the corresponding loss of knowledge as long-term employees retire. This is where partial retirement (PR) comes into play.


What is partial retirement?

Partial retirement is a model that allows older employees to gradually adjust their working hours and transition into retirement. This is achieved through a combination of reduced working hours and thus increased time off. During the working hours, employees work reduced hours, and during the leave phases, they are on paid leave. The goal is to facilitate a smooth transition into retirement while addressing the skilled labor shortage.

Benefits for Employees

Social and Financial Transition: Partial retirement enables employees to transition gradually from work to retirement, easing the social and financial transition. This can reduce transition stress and enhance well-being. The existing lifestyle can gradually adapt to the new circumstances.

More Free Time: Employees have the opportunity to enjoy more leisure time without having to retire immediately. This allows them to pursue long-held hobbies, travel, or spend more time with their families.

Retirement Benefits: In many cases, employees can also improve their retirement benefits during partial retirement by continuing to contribute to their pension fund.

Preservation of Expertise: Experienced employees can retain valuable knowledge and skills within the company rather than losing it upon their departure. This is particularly important in industries that require specialized expertise. Experienced employees can also serve as mentors in the context of personnel development.

Talent Management

Talent Management is a core area of the HR department and encourages employees to realize their full potential. Especially in a highly dynamic environment, this is essential for a company to remain competitive.

Personalentwicklung als Kernbereich der HR

Benefits for Employers

Knowledge Retention: Companies can benefit from the expertise and experience of their older employees, even when they reduce their working hours. This is crucial in preventing the loss of valuable know-how.

Succession Planning: Partial retirement enables targeted succession planning, as younger employees can be introduced to the responsibilities and tasks of those who are retiring. This contributes to continuity within the company.

Image and Employee Retention: Companies that offer partial retirement are often seen as attractive employers and can foster the retention of experienced professionals. This can reduce turnover and enhance the company's image.

Flexibility: Partial retirement models can be tailored to the specific needs of the company and its employees, allowing for an individualized transition phase.

From when is partial retirement possible?

Partial retirement is possible for employees from the age of 55 as long as throughout the past five years preceding the start of partial retirement they have been employed for at least 1080 calendar days in full or part-time (contributing to social security).

Implementation of Partial Retirement

The specific conditions and regulations for partial retirement can vary from country to country and from company to company. It is important to consider the respective laws and guidelines and adjust partial retirement models accordingly. Transparent communication between the employer and the employee is crucial to ensure a smooth implementation.

Partial retirement is a win-win situation for all parties involved. It facilitates the transition into retirement, preserves valuable knowledge, and promotes continuity within the company, particularly in addressing skills shortages. Companies should consider this flexible model as part of their strategy for employee and knowledge retention. At the same time, employees can view partial retirement as an opportunity to shape their retirement on their own terms while continuing to be professionally active. This contributes to making the transition into retirement a positive and fulfilling phase of life.


We would like to point out that our website provides non-binding information, which under no circumstances constitutes legal advice. This also, and especially, applies to topics within the sphere of legal HR advise. The content of this contribution cannot and is not intended to replace individual and binding legal advice. For this reason, all information provided is without guarantee of correctness and completeness, but always researched with the utmost care.

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