When applying for work at the plant

Upon entering the Sokolovsky Metal plant, employees Prakhov and Kolosov entered into an employment contract for an indefinite period. In December 2001, Prakhov retired from old age, but continued to work, and Kolosov was to retire from his old age in November 2002. In mid-February 2002, both employees were called to the personnel department, where the department inspector offered them to in accordance with Art. 59 of the Labor Code of the Russian Federation, switch to a fixed-term employment contract: to Prakhov from the next day, and to Kolosov from the day of retirement.
Is the human resources inspector right? What are the features of applying the Labor Code of the Russian Federation to legal relations that arose before its entry into force?