Employment law
Pension: Early retirement without a reduction
End of February, offices of Transit Sahel Logistique. Between two customs declarations, Hawa, an accounts assistant, puts a letter announcing her departure on the director’s desk: she will stop on 28 February. She turns 55 on 12 March. Twelve days’ difference, and a reduced pension for the rest of her life.
Transit Sahel Logistique and the people mentioned in this article are fictitious: they are used as examples only.
1. What exactly are we talking about?
Transit Sahel Logistique employs 55 people in Bamako. Hawa, classified in category B, has worked there for twenty years and has twenty years of insurance with the National Social Security Institute (INPS).
The normal age for liquidating the pension is 58. Liquidation is the point at which the INPS sets the amount of the pension and starts paying it. Before 58, the pension is called early. In principle, it suffers a reduction, i.e. a cut of 5% per year of anticipation, between 53 and 55 (Social Security Code, article 144).
The Code provides for three cases in which a person leaves before 58 without any reduction:
| Situation | Age | Text |
|---|---|---|
| Insured person with 13 years of insurance | Having turned 55 | Article 144 |
| Insured person medically recognised as unfit for work | From 53 | Article 145 |
| Holder of a disability pension | At 53, automatically | Article 150 |
In all cases, the retirement pension requires at least thirteen years of salaried employment giving rise to contributions (article 143). The Code speaks of 55 révolus, meaning completed: a person has completed 55 years on their 55th birthday, not before.
Why this rule? The Code keeps the reduction for the earliest departures and removes it when health makes stopping work necessary.
The most common mistake
Believing that “without reduction” means “full pension”. The pension is still calculated on the years actually contributed: leaving at 55 means giving up the years that would have been contributed until 58.
Without reduction does not mean without loss: it is the years not contributed that cost.
2. Having turned 55: the calculation step by step
The pension is calculated on average monthly remuneration over the last eight years, at 2% per year of insurance (article 156).
Example. Hawa has an average monthly remuneration of XOF 250,000 and twenty years of insurance. She leaves having turned 55.
Rate: 20 years × 2% = 40%
Pension without reduction: 250,000 × 40% = XOF 100,000 per month
What leaving at 55 rather than 58 costs
Example. If Hawa stayed until 58, she would have 23 years of insurance, with the same average remuneration.
Pension at 58: 250,000 × (23 × 2%) = 250,000 × 46% = XOF 115,000
Pension at 55: XOF 100,000
Difference: 115,000 − 100,000 = XOF 15,000 per month, for the whole of retirement
What you need to do
- Check the employee’s exact date of birth and insurance period on their INPS statement.
- Calculate in writing the pension at 55 and at 58, and give this calculation to the employee.
- Point out that the early pension is still calculated on the years contributed only.
3. On the contract side: retirement or resignation?
The Labour Code allows private-sector employees to request the liquidation of their pension at 55 for categories B, C, D and E, and at 57 for category A. Leaving at these ages, at the employee’s initiative, does not constitute a resignation (Labour Code, article L.60 bis).
| Category | Pension without reduction (INPS) | Departure that is not a resignation |
|---|---|---|
| B, C, D and E | Having turned 55 | From 55 |
| A (executives) | Having turned 55 | From 57 |
A category A executive who leaves at 55 or 56 therefore obtains a pension without reduction, but their departure follows the rules on resignation: written notification and a three-month notice period (articles L.40 and L.41).
The retirement payment
An employee who permanently stops working to start receiving their pension receives a retirement payment, calculated like severance pay (Labour Code, article L.55 and article L.53).
Example. Hawa has twenty years of service and an average monthly salary of XOF 250,000 over her last twelve months.
Years 1 to 5: 5 × 20% = 100%
Years 6 to 10: 5 × 25% = 125%
Years 11 to 20: 10 × 30% = 300%
Payment: 250,000 × 525% = XOF 1,312,500
What you need to do
- Check the employee’s category before accepting a departure at 55 or 56 as retirement.
- Calculate and pay the retirement payment on the day of departure.
- Issue the certificate of employment and the proof of cessation of work required by the INPS.
4. The health route: from 53, without reduction
The age of 58 is lowered to 53, without reduction, for an insured person medically recognised as unfit for work (Social Security Code, article 145). According to the INPS, this pension requires thirteen years of insurance, an age between 53 and 55, and a medical certificate stating that the person cannot carry out any professional activity, issued by the treating doctor and confirmed by the INPS medical adviser. In the event of a dispute, unfitness is assessed by a committee chaired by a doctor appointed by the minister in charge of health, with a representative of the minister in charge of labour, an INPS doctor and a representative of employers and of workers (article 237).
Example. Modibo, a driver at Transit Sahel Logistique, is 53, has sixteen years of insurance and an average remuneration of XOF 180,000. Complicated diabetes now prevents him from driving.
Pension for unfitness: 180,000 × (16 × 2%) = 180,000 × 32% = XOF 57,600
Voluntary departure at 53, 10% reduction: 57,600 × 90% = XOF 51,840
Difference: 57,600 − 51,840 = XOF 5,760 per month, for the whole of retirement
What you need to do
- Refer an ill employee to their treating doctor before they file a request for voluntary departure.
- Attach to the file the medical certificate of unfitness, to be confirmed by the INPS medical adviser.
5. A closer look: the date that changes everything
Hawa turns 55 on 12 March. If she stops working on 28 February, she leaves at 54 and suffers a reduction for one year.
Pension if she leaves on or after 12 March: XOF 100,000
Pension if she leaves on 28 February: 100,000 × 95% = XOF 95,000
Loss: XOF 5,000 per month, for the whole of retirement, for twelve days’ difference
The pension takes effect on the first day of the calendar month following the end of work, provided the application reaches the INPS within six months; otherwise, on the first day of the month following its receipt (Social Security Code, article 146). The application is accompanied by proof that work has stopped and an undertaking not to resume salaried activity (article 155). See also our article Standard pension.
Key takeaways in 6 points
- Remember the three routes without reduction: having turned 55, medical unfitness from 53, disability pension converted at 53.
- Check the thirteen years of insurance: without them, no early pension is possible.
- Set the leaving date no earlier than the 55th birthday: one day too early means 5% less for good.
- Calculate the difference with leaving at 58: the early pension is still calculated on the years contributed.
- Treat the departure of a category A executive before 57 as a resignation: written letter and notice period.
- Send the application to the INPS within six months so as not to lose any month of pension.