When is the default retirement age being abolished?
The default retirement age will be abolished from 1 October 2011. Employees who reach 65 on or after 1st October 2011 cannot be forced to retire using the current statutory procedure.Transitional provisions will apply from 6 April 2011 which mean that the last date that employers can issue notices of retirement is 5 April 2011. Retirements issued by this date will be lawful provided that the employer follows the correct procedure
Will employers be able to force employees to retire once the default retirement age is abolished?
No. From 6 April 2011, retirement will no longer be included as one of the potentially fair reasons for dismissal under s.98 of the Employment Rights Act 1996, unless the transitional provisions apply and the employee has already been given notice of retirement in accordance with the statutory retirement procedure. A forced retirement after this date could potentially lead to a successful claim for unfair dismissal and/or age discrimination, unless:
- the employee wants to retire voluntarily
- the employer will has a fair, objective reason for dismissal (such as redundancy or capability) and follow a fair procedure before they dismiss
In what circumstances will employers be able to justify compulsorily retiring employees?
To be able to retire employees compulsorily, employers will have to be able to demonstrate that the retirement age is objectively justified. The ACAS guidance states that employers will continue to be able to retire an employee at a set age provided it can be objectively justified. They call this the “employer justified retirement age” (EJRA).
They go on to say that they expect “case-law around EJRA [to] develop once the DRA has been abolished.” Examples given of objective justifications are workforce planning or the health and safety of individual employees.
How will the abolition of the default retirement age affect recruitment practices?
According to XpertHR: “Employers may need to adjust their recruitment practices, to ensure that the number of new employees recruited is proportionate to the number of retirements. This is likely to be less predictable once the default retirement age has been abolished.”
“In addition, the current exemption from the age discrimination provisions that allows employers to reject an applicant who has reached, or is within six months of reaching, the retirement age of 65 or older, will no longer apply from 6 April 2011. Employers will need to ensure that they consider applications from candidates of any age on the basis of merit and suitability for the job in question rather than their age”.
For UNISON guidance on this issue, see the Age Equality Factsheet here.
