Default retirement age to be phased out

The Government has announced details of how it intends to remove the default retirement age (DRA) of 65. At present the law allows employers to force employees to retire at the age of 65 regardless of their circumstances. Their only obligation is to follow the statutory retirement procedure that may simply involve holding a meeting with the employee six months before their 65th birthday to discuss plans and to give them notice if they intend to make them retire.

It is proposed that the default age of 65 be phased out from April 2011. The phasing out of this provision is due to the fact that people are living longer and healthier lives. It is also thought that it will encourage people to work for longer.

Key Proposals:

  • Retirements under the DRA will cease completely on 1 October 2011 and no new notices of intended retirement may be issued after 6 April 2011.
  • Retirement dismissals will still be permissible for individual employers to operate a compulsory retirement age after 1 October 2011, provided that they can objectively justify it.
  • Transitional arrangements will apply to retirements that have been notified before 6 April 2011 to take effect before 1 October 2011. Retirements notified before 6 April, but intended to take effect after 1 October, will not be valid (unless objectively justified).
  • The procedural requirements applicable to a retirement dismissal will also be abolished.

Sarah Evans
Partner
SMR Solicitors

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