The End Of The Default Retirement Age

Date Added: 11 January 2011

From October 1st 2011 the right of an employer to compel an employee to retire at 65 will be abolished.

At present, employers can compel employees to retire at their normal retirement age (provided it is 65 or over) without fear of tribunal claims of age discrimination or unfair dismissal. All the employer has to do is to follow the proper retirement procedures. While it had been widely expected that the age at which this would be permitted would increase (perhaps to 67), few expected that the Government would announce proposals to abolish this right.

The prososals state that after 6th April 2011 employers will not be able to issue any notifications for compulsory retirement. There will be no general rules permitting retirement dismissals. The normal age discrimination and unfair dismissal rules will apply. Retirement would not be considered a special reason for dismissal except in very limited cases.

Implications for employers
While many employees will welcome this, employers are likely to be concerned about the prospect of an ageing workforce (some with health problems that might amount to disabilities), that will have to be performance managed and for whom 'reasonable adjustments' may well have to be made.

These proposals will not prevent an employee voluntarily retiring at 65 or some other age, and this is likely to remain the preferred option for many employees.

You need to consider the implications for your business now because the current retirement procedures require you to consult with the employee six months prior to the intended retirement date, and to notify the employee prior to 6th April 2011.

This is a summary of the position. It does not provide a comprehensive statement of the law. Please contact our employment team for specific advice.

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