Priyanka Lekhi, VP, People and Culture at Open Financial Technologies Pvt. Ltd believes that organisations need to create a more flexible approach to the retiring workforce as the value that this lot brings to the table is immense.
Retirement benefits are as important as offering joining bonuses or giving BMWs to new joinees. It can be one of the pillars of the talent strategy. As per a Glassdoor survey from 2018, new recruits prefer additional perks apart from a pay rise and retirement plan; pension ranked fifth on the list. That means candidates are looking for companies that promise to offer benefits that extend beyond salary hikes and bonuses. But in the present context, nobody stays in a company long enough to benefit from such plans. While it’s great to have perks like recreational areas in the office, flexible work culture, and even a four-day workweek, employees want to feel that organisations are invested in them and want to keep them for a long time.
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If we talk about India, a Max Life Insurance Company 2021 survey in partnership with Karvy insights highlighted that the degree to which Indians feel financially secure for retirement is 50. According to the survey, nearly 80 percent of the respondents feel they should have started investing earlier towards retirement. While there is awareness, the realisation dawns a lot later making financial wellbeing after retirement a stressful process. But organisations are doing their bit to solve this.
“According to the survey, nearly 80 percent of the respondents feel they should have started investing earlier towards retirement. While there is awareness, the realisation dawns a lot later making financial wellbeing after retirement a stressful process. But organisations are doing their bit to solve this.”
KPMG, an accounting consulting firm with a global presence, went through a few major reshuffles in terms of several of its employee benefit schemes including the retirement plans. Forbes reports that the firm replaced its 401(K) policy with an automatic 6-8 percent contribution from the employer even if the employees don’t contribute anything to it.
Most recently, a Bengaluru-based neo-banking startup Open had its first retirement instance and they decided to be thoughtful rather than just offering a corpus. It was during a drive back from Calicut to Bangalore, when Open’s Anish Achuthan, Co-founder and CEO, and Mabel Chacko, Co-founder and COO came to know about their soon-to-retire employee, Hema Anand’s wish. Hema is a huge fan of the much-celebrated singer, KK, and so they decided to turn her dream into reality by bringing her favourite singer right in front of her.
Anish and Mabel have known Hema for over a decade during their entrepreneurial journey. As she touched 60, they decided to give her the retirement and farewell she deserved. This not only included her favourite singer, KK but messages from her family abroad, Shankar Mahadevan, Kailash Kher, and live performances from her colleagues.
Hema Anand, who retired after three years with the company where she held the post of VP-Operations, is Open’s first retired employee. She was offered a retirement package with a cheque of Rs 30 lakhs along with shares worth Rs 3 crores, and gadgets including a laptop, mobile, and AirPods to start her new innings. This was dedicated to her for building the operations team at Open over the past 3 years, as well as her 14-year service to the industry.
Hema was overwhelmed by the way the company reacted to her retirement on her last day and received wishes not just from her colleagues but from the startup community in India as a whole. After over 40 years of work experience, Hema now aspires to travel the world with her husband who also happened to be the first person she met on the first day of her work life.
A recent report by Omam Consultancy firm suggests attrition is projected at 19 percent this year compared to 12 percent in 2021. Open’s initiative to reward its retiring employee can be seen as a means to retain talent and contain the attrition in the company. Priyanka Lekhi, VP, People and Culture at Open Financial Technologies Pvt Ltd. believes that this can be an employee retention exercise but that’s not their motive. “Our aim is to make our employees feel comfortable and safe in the workplace right from mental health to physical health and ensure they are taken care of. Even during the pandemic, we had a 24*7 ambulance service available to our employees along with benefits like a Covid kit and an on-call doctor available for employees,” Lekhi shares.
While Open doesn’t have any immediate plans of having retired employees on the board, “it is something we are actively considering,” Lekhi informs.
Startups generally have a young population, even in the higher ranks. So the instances of employees retiring are few if we don’t consider attrition here. Hence, the instances of such benefits are also far and few. But Lekhi is of the opinion that there is a need to start thinking about the HR policies from this added perspective. “Since startups see a younger average crowd, policies are not built keeping in mind the “near retirement” employees. But with years of industry experience, the value that this lot brings to the table is immense. What would make your employees want to retire from your company? Do you want to attract that “experienced” talent pool and how do you make them feel secure and safe in the knowledge that the company is also thinking about your life beyond its four walls and beyond the last working day?” reasons Lekhi.
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“Startups generally have a young population, even in the higher ranks. So the instances of employees retiring are few if we don’t consider attrition here. Hence, the instances of such benefits are also far and few. But Lekhi is of the opinion that there is a need to start thinking about the HR policies from this added perspective.”
It has been seen that younger professionals are quite interested in retiring early. A Goldman Sachs Asset Management survey in 2021 found 25 percent of Gen-Z eager to retire by the age of 55. It is of course aspirational rather than a realistic assumption. Lekhi asserts that at Open, there are no barriers in the form of age, gender, background, etc. They allow employees to explore their talent and believe in giving people chances. “We are one of the few organisations that have more women in senior positions, i.e above 50 percent. Hema was one of them,” she points out.
Compared to legacy firms, startups always think differently, be it in terms of product design or approach to problem-solving. Most startups tend to hire/attract younger folks, but it would help if more startups were age agnostic or unbiased. “Things like retirement benefits will also help to attract more experienced candidates to the startup workforce, and also increase the average tenure of an employee in an organisation,” Lekhi signs off.
– with inputs from Bruhadeeswaran R
Year of incorporation: 2017
Number of employees: 500+
Name of the founders: Anish Achuthan, Mabel Chacko, Deena Jacob, and Ajeesh Achuthan
Name of the key execs: Priyanka Lekhi, VP, People & Culture
Business line: All-in-one digital banking for businesses
Hiring pipeline: 1200+ by the end of 2022