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Can I still retire someone at age 65?
No! There is no longer a default retirement age and in theory employees can continue working to any age they like.
How can I find out if/when my employee might be thinking of retiring?
You could put in place a mechanism such as an appraisal system that enables you to discuss future plans with all your employees so you have an idea of how they see their career progressing. Since most people expect to retire at some point it is not unreasonable to talk to an older person about any plans they may have in this respect as part of the appraisal process.
What do I do if an older employee becomes less productive and/or less able to do their job safely?
The same as for any other employee! Talk to the individual informally to find out what the problem might be and to see if it can be resolved for example by providing additional training, thus improving performance. If it can’t be resolved you may have to use a Capability Procedure if you have one or a Disciplinary Procedure if you don’t, to address the issue. Bear in mind that if you invoke this procedure against an older worker, particularly one who has been with you for several years, it can be an undignified way to end their working life.