Purpose To longitudinally investigate (1) whether lower work ability and work engagement predict the use of company policies on reduced working hours and exemption from evening/night work among older workers, and (2) whether using such policies subsequently contribute to higher work ability and work engagement. Methods In total 6922 employees (45-64 years) participating in the first three waves of the Study on Transitions in Employment, Ability and Motivation were included. Participants yearly filled out an online questionnaires. Regression analyses were applied to study the influence of baseline work ability and work engagement on the incident use of policies during the first year of follow-up, and the incident use of these policies on work ability and work engagement during the second year of follow-up. Results Employees with a higher work ability were less likely to start using the policy 'reduced working hours' [OR 0.91 (95 % CI 0.83-0.98)]. Starting to use this policy was in turn related to lower work ability 1 year later [B -0.28 (95 % CI -0.47 to -0.08)]. Starting to use the policy 'exemption from evening/night work' was related to higher work engagement 1 year later [B 0.23 (95 % CI 0.07-0.39)]. Conclusions Low work ability precedes the use of some company policies aiming to support sustainable employability of older workers. Further research is needed to explore whether company policies result in a (longstanding) improvement, or reduced deterioration, of older workers' employability.