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“Welcome aboard from Captain Jenkins and his crew. We hope you enjoy your flight”….The announcement would probably wash over most passengers. But what if they heard Captain Jenkins was 93 years old? The default retirement (DRA) age of 65 is being abolished in October next year. Does that seriously mean any employee can hang on as long as he or she cares to?
The DRA was there for companies that did not have their own retirement policy. Companies can automatically retire staff at this age providing they go through the proper procedure. Once the DRA is gone there will be no set age for retirement to fall back on.
Anti age discrimination laws already give staff the right to ask their employers if they can stay on beyond 65. The right to request this is a bit like the right to request flexible working and there is no obligation on employers to agree. These requests are granted more than half of the time, which is evidence that keeping older workers on can be mutually beneficial.
The DRA had its advantages – at least everyone knew where they stood. Regardless of an employee’s wishes, bosses can currently forcibly retire someone, because of the DRA. They just have to write to the employee about his retirement 6-12 months ahead of an intended retirement date and tell him he is allowed to ask to stay on.
This compulsory retirement procedure will be axed when the DRA goes. Few employers will miss the procedure itself because any mistakes in it exposed employers to unfair dismissal claims in the past.
This does not mean Captain Jenkins will still be flying us about at 93. Companies will be free to keep their own retirement age providing this can be justified as a proportionate means to a legitimate aim. Medical and aptitude tests might become more common – and not just in industries like aviation where they are already used.
A legitimate aim is a nebulous concept and doubtless there will be litigation over it. There is guidance about how this will turn out, however, because some companies already have their own retirement ages and inevitably, there have already been legal challenges to them too. In one recent case the Court of Appeal ruled that a solicitors’ firm’s compulsory retirement age of 65 for partners was justified. The firm successfully argued its legitimate aim was to ensure younger lawyers could be promoted. It also argued that without a retirement age it would need to introduce a performance test for older lawyers to ensure they were still up to scratch. This was bound to cause more confrontation and mistrust in the workplace.
All employers will have to rethink their retirement policies. Many already have a flexible attitude towards retirement – allowing some staff to stay on either part time or full time, according to their wishes. Other employers should follow suit.
Employers will all have to decide whether to have their own retirement age – and if so how it can be justified. Employment contracts must clearly state what the retirement policy is. There should also be clear guidelines about any flexibility.
Failure to have a policy could mean an employee could stay on indefinitely – until someone gets round to dismissing them for capability reasons. This would be a ghastly end to a career and a headache for the boss.
Peta Fluendy is employment law consultant at Sutton based De Brett and Co’s http://www.iambeingfired.co.uk/
Tags: Default Retirement, employment law, Peta Fluendy, Women and pensions
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July 22nd, 2011 at 2:53 pmaureen white says:
I was 65 in february 2011 – my company renewed my emplyment on a siz month contract they then have renewed it again until February 2012 but have told that that was it I would have to retire… I feel pretty put out as I want to work on further are they correct in what they have done ?