How Employers Can Prepare for Retirement Age Changes; Joanne Davies, Employment Lawyer and Partner with Morgan Cole, Examines the Implications of Phasing out the National Default Retirement Age
Byline: Joanne Davies
SO, it's all change. Our new Government is of the view that those who need or wish to work past 65 and are able to do so should not be denied the opportunity simply because they have reached a particular age.
There are a range of reasons for encouraging individuals to work beyond 65, according to the Government, including demographic change as people live longer; there are financial benefits to both the individual and the wider economy, and health and social benefits people gain from working.
There is also the benefit of the removal of the costs and associated administrative burden of the statutory retirement procedure.
The Government proposes to phase out the default retirement age (DRA) from April 6, 2011 and retirements under the DRA will cease completely on October 1, 2011.
If employers want to retain a compulsory retirement age in their organisation they will only be able to do so if they can objectively justify it. This is likely to be difficult to do for the vast majority of employers. The statutory retirement procedure will also be removed.
Following the removal of the DRA, any dismissal of an individual will need to be conducted adopting a fair procedure and for a fair reason (namely, capability, conduct, redundancy, illegality or some other substantial reason).
It is important to note that the DRA applies to "employees" as defined by the Employment Rights Act 1996 and so, a number of groups will be unaffected by the removal of the DRA including those professions where there is a statutory age limit such as commercial pilots or partnerships. …