11/03/2009

Employment e-Brief – compulsory retirement at 65

In theory, the Employment Equality (Age) Regulations 2006 provide employers with the option of compulsory retirement for their staff at the age of 65.

However, the charity Age Concern claimed that this was discriminatory on the grounds of age and so the High Court referred the matter to the European Court of Justice ( the “ECJ”) for clarification.

Interestingly, the ECJ ruled that the statutory retirement procedure did not breach EU legislation if the practice had a legitimate aim in terms of employment and social policy however, the matter was referred back to the High Court to determine whether the age limit of 65 is justified.

The practical effect of this is that as employers, you may wish to err on the side of caution when following the statutory retirement procedure. Approximately 260 tribunal cases, claiming that enforced retirement is discriminatory on the grounds of age, are still unresolved and await the final outcome of Age Concern’s legal action. Clearly, if Age Concern are successful, thousands more claims may be commenced by people who were forced to retire against their will.

The statutory retirement procedure does contain a provision allowing the employee to request that they can carry on working beyond the age of 65 however, until the High Court makes a decision as to whether or not the Government’s aims in setting the compulsory retirement age at 65 are legitimate, employers using the statutory retirement procedure may risk facing age discrimination claims in future.

If you require any further advice on this matter, then please contact a member of the Employment team.