The government has now published the draft regulations for the abolishment of the default retirement age later this year, but there is a problem with the way the transitional provisions have been drafted.
Employers may force the retirement of employees who reach the current default retirement age of 65 between 6 April 2011 and 30 September 2011. It also appears ok to give 12 months’ notice to terminate employment up to 5 April 2012. In both cases, as long as the current retirement procedures are followed correctly employers should be safe from claims. However, the transitional provisions do not seem to apply to any employee who has already reached the age of 65 by 6 April 2011. The consequence of this is that many employers, who already have pending retirements in place to take place before 1 October 2011, may not be safe, even if the proper procedure has been followed.
Many in the employment law field believe there has been a drafting error and that the problem will be rectified when the final regulations come into force. In the meantime, employers have 2 options:
- Consider negotiating a compromise agreement for any employees being retired between 6 April 2011 and 1 October 2011 that have already reached the age of 65 before 6 April; or
- Do nothing for now and wait to see what happens.
Kate Fretten, Head of our Employment Team, says "Our advice is to, for the time being, take the second option. Although Parliament has recently had the reputation for not correcting drafting errors, this particular issue seems to be nonsense and makes the whole purpose of the regulations largely redundant. If you are considering making planned retirements between now and October 2011 it would be wise to take advice and the Employment Team here at Frettens would be pleased to help."