Default Retirement Age to be phased out

The Governement has announced that it plans to phase out the default retirement age of 65 from April 2011.

Key aspects of the proposals are as follows:

• Retirements under the existing default retirement age of 65 will be phased out from 6 April 2011; and will cease completely on 1 October 2011.
• Retirement dimissals will still be permissible after 1st October but only if objectively justified.
• Transitional arranegements will apply during the period from 6 April to 1 October 2011.
• The procedural requirements which apply to a retirement dismissal will be abolished with effect from October 2011.

The plans to phase out the default retirement age have attracted criticism from employers' groups.

• John Cridland, Director General of the CBI, has claimed that the scrapping the default retirement age will create a 'vacuum', creating uncertainty as well as legal and employment problems.  He has argued that it will take more than a code of practice to resolve these practical issues.
• Some concern has been expressed that the ending of the default retirement age will lead to more contentious terminations: for example, employers having to justify the dismissal of older workers on the basis of their health and capabilities.
• One specialist recruiter has pointed to the impact which phasing out the default retiremenat age will have on younger workers, as older workers stay in work longer and younger workers have to wait longer to be promoted or progress with their careers.

The Government's proposals are subject to a consultation which will run until 21st October 2010.

Notes:

1. The default retirement age was set at 65 by the Employment Equality (Age) Regulations 2006.  The Regulations permit compulsory retirement at the age of 65 provided employers follow a procedure.

2. For advice in relation to this issue, please e-mail This e-mail address is being protected from spambots. You need JavaScript enabled to view it