Leaving Soon? - Retirement

Retirement is the light at the end of the tunnel for many people; it is the time to sit back and enjoy the results of your hard efforts during your employment lifetime.

Other people see retirement as something they would like to avoid for as long as possible. Many people are choosing to remain in employment past the traditional retirement age of 65, either because they remain passionate about their job, or they would like to continue earning.

However you feel about it, it is important to know the employment law in this area as it may not be what you expect.

The statutory default retirement age

Employment law previously gave your employer the right to automatically retire you once you had reached the age of 65. They must have given you at least six months’ notice and no more than 12 months’ notice of their intention to retire you.

However, as of 6 April 2011, the statutory default retirement age will be phased out. Employment law reforms mean that employers will no longer be able to issue statutory default retirement notices to employees simply because they are going to turn 65 within a year.

If an employer has issued a statutory default retirement age notice before or on 5 April 2011 to an employee, they can still be forcibly retired when they reach 65, provided they turn 65 before 30 September 2011.

So when will I retire?

The result of the employment law reforms means that there is now a little uncertainty surrounding the age that someone can retire. However, in reality many people will continue to retire in the same way as before the reforms; when they reach their State Pension age, when they reach the age of retirement stipulated in their employment contract, or when they simply decide they no longer wish to work anymore.

Hopefully, through careful planning and increased communication, employers and employees will be able to come to a mutually satisfactory agreement on when employees should retire.

However, an employer is allowed under employment law to retire an employee if they are no longer capable of performing their job satisfactorily. A correct and fair procedure must be used by the employer if retiring an employee for this reason.

Compulsory retirement and age discrimination

Despite the statutory default retirement age of 65 being scrapped, an employer can compulsorily retire an employee at a set age if they can show that they have a good reason for doing so. If they can ‘objectively justify’ the set retirement age, they will be able to compulsorily retire employees at that age.

Objective justifications must be proportionate and necessary to achieve a legitimate business aim, and they must be supported with evidence by the employer. For example, a legitimate business aim could be to protect the health and safety of the business’s employees. If employees of a certain age can be shown to pose a threat to the health and safety of other employees, a proportionate and necessary response would be to have a set retirement age.

An employer is still expected to use a fair procedure when retiring employees at a set retirement age, such as giving them adequate notice and allowing the employee to make a request to work past the set retirement age.

If your employer cannot objectively justify your early retirement, you may have a claim for age discrimination and unfair dismissal against them in an Employment Tribunal.

Your contract of employment may contain a provision that states the age at which you will be expected to retire or there may a customary age at which people in your industry retire. If your employer attempts to retire you before the age contained in your contract or the customary age, you may have an unfair dismissal claim against them.

Job Justice can help

If you are facing retirement, or have recently retired and you feel like you need some legal advice, we can put you in touch with one of our specialist employment solicitors. Simply call us for free on 0800 533 5799 or fill in our online contact form and we’ll be in touch to discuss your situation.

 

 

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