Julia Stirling of Healys LLP employment law team in London summarises the latest news
The Government has now (1 March) issued draft regulations on the abolition of the retirement age (a second draft after problems with the first draft were spotted): The Employment Equality (Repeal of Retirement Age Provisions) Regulations 2011.
The regulations say that:
- the last day on which notification of retirement can be given to an employee is 5 April 2011
- the employee has to be 65, or will be 65, before 1 October 2011
Any employees currently under notice of their retirement date can still be retired as intended, provided they are already 65, or will be 65, before 1 October 2011. The retirement procedure can continue as usual, but notification must have been given to the employee by 5 April 2011.
Background
In 2006, age discrimination became unlawful, but a retirement age of 65 was allowed, so that employees' contracts could be ended at 65 so long as employers followed a prescribed procedure.
Briefly, employers have to notify employees no less than six months and no more than 12 months before the intended retirement date. Employees can request an extension to their retirement date and if so, a meeting is held to discuss the request, but the employer does not have to agree, or to justify its decision if it refuses.
If employers follow the procedure, they are protected from age discrimination or unfair dismissal claims.
It is possible for employers to have a retirement age lower than 65, but this has to be objectively justified – generally only a minority of employers will be able to do this.
6 April 2011 onwards
No notifications of retirement can be issued after 5 April 2011. Age will no longer be a fair reason for terminating an employment contract (unless it is objectively justified). Employers will have to show that any dismissal is because of one of the remaining potentially fair reasons (e.g. redundancy, lack of competence) and follow a fair procedure. If they do not, they will be open to claims of unfair dismissal and age discrimination.
Employers should check any planned retirements carefully – they have a little over a month left to start the process.
For more on this article or if you require advice on employment law for employers or employees, please call Julia Stirling on 0207 822 4101 or email julia.stirling@healys.com
