Work in old age and when disabled: The role of employer responsibility

We analyze the role of employers in establishing suitable labor market conditions to maintain the productivity of workers. We focus on two groups: Disabled and older people. We analyze the employer responsibility to accommodate workers with partial disabilities, and to accommodate older workers in flexible work arrangements until the statutory retirement age or beyond.

In the first part of the project, we analyze the extensive (financial) responsibilities of employers for work resumption in the Dutch disability insurance scheme. The aim of obligating employers is to keep workers with health impairments in their jobs and improve their work resumption. The high degree of employer responsibility, however, carries potential costs. We quantify benefits and costs to assess the optimal degree of employer involvement in the disability insurance scheme.

In the second part of the project, we study the importance of an inflexible labor market for older workers with respect to the prevalent abrupt transition from full-time work into full retirement. We identify the role of employer-side factors, disentangling them from worker preferences and financial incentives built into the social security system. We assess the empirical relevance of these factors using linked administrative and survey data. Based on these data, we construct and estimate dynamic structural models which allow to study welfare effects and simulate policy reforms. Our research helps to develop policies to support sustainable employment among disabled and older people, increasing their financial well-being and preserving the viability of the social security system.

Netspar, Network for Studies on Pensions, Aging and Retirement, is a thinktank and knowledge network. Netspar is dedicated to promoting a wider understanding of the economic and social implications of pensions, aging and retirement in the Netherlands and Europe.

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