The government has confirmed that the default retirement age of 65 is to be phased out later this year. It means that employers will no longer be allowed to dismiss staff just because they have reached the age of 65. The Department of Business said that as well as benefiting individuals, “the freedom to work for longer will provide a boost to the UK economy”.
Employers had called for the changes to be delayed for a year to allow greater legal clarity over the plans. The Employment Relations Minister, Edward Davey, has said it will still be possible for employers to force people to retire if they are no longer up to the job.
The change means that from 6 April 2011 employers will not be able to issue any notifications for compulsory retirement using the default retirement age procedure. Between 6 April 2011 and 1 October 2011 only those people who were told before 6 April and who are due to retire before 1 October can be compulsory retired using the default retirement age. Individual employers may still be able to operate a compulsory retirement age if they can objectively justify it, but we would strongly advise taking legal advice before going down this route. The Department of Business has given two examples where they think this might be the case, namely air traffic controllers and police officers.
One consequence that the government does not seem to have accounted for is the rush by some employers to serve notice on employees who are 65 or over already before the April deadline. It has already been reported in the national press that this is happening and here at Frettens we have already had a couple of clients enquire as to whether this can be done. The answer is it can, as long as the person is served notice before 6 April and their retirement date will take place before 1 October.
Contact us for clarification on any of these points – we are happy to answer questions over the phone for free or in a free initial meeting.
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