Abolition of Default Retirement Age

The Government has recently confirmed the phasing out of the Default Retirement Age of 65.

Under new rules coming into force on 6th April 2011, it will only be lawful for an employer to have a compulsory retirement age that can be objectively justified – i.e. the employer will have to show that it is a proportionate means of achieving a legitimate aim. Examples of a compulsory retirement age being objectively justified might be where there is a need for a significant level of physical fitness – e.g. a fire-fighter - or exceptional mental fitness – e.g. an air traffic controller.

The same rules will now apply to all employees regardless of age. It will only be lawful to dismiss an employee where the employer can establish a potentially fair dismissal such as capability, conduct or redundancy etc. Any such dismissal would also have to be procedurally fair. Failure to follow these rules could leave an employer open to claims for unfair dismissal or age discrimination.
Under the existing rules, an employer may give an employee not less than six and not more than twelve months’ notice of his intended retirement. The employee may make a request to continue working. The employer must consider the request but, ultimately, may reject it.

The new rules contain a transitional exception, under which a notice given under the existing rules that is given before but expires after 6th April 2011 will continue to be effective. The latest draft of the new rules makes it clear that the exception applies to any employee who reaches the age of 65 or (if higher) normal retirement age for his employment before 1st October 2011.

If you would like to know more, please contact Nick Crook or Gareth Pobjoy.

Filed: 16/02/2011 09:13:08