Under current law there is no definition of “phased retirement.” However, employers currently devise a variety of ways in which to implement such programs -- by either allowing critical employees to reduce their schedules rather than retire or by allowing retired employees to return as independent contractors. In either case, employers who implement either formal or informal phased retirement programs must make sure that such programs comply with the Age Discrimination in Employment Act (ADEA).
Workplace Flexibility 2010, Georgetown University Law Center, "Phased Retirement and the Age Discrimination in Employment Act: Legal Standards and Risks" (2008). Memos and Fact Sheets. Paper 53.