The Government has announced details of how it will remove the default retirement age of 65 permitted by the Employment Equality (Age) Regulations 2006. It proposes to begin phasing out the DRA from April 2011. The proposals are subject to a consultation which will run from now until 21 October 2010. The new plans allow for a six month transition from the existing regulations, following the announcement in the Budget that the DRA would be phased out from April 2011. The intention is to enable and encourage people to work longer if they wish to and in response to the demographic change which is seeing people live longer. The Government is also committed to help employers by removing the administrative burden of the current DRA associated retirement procedure “right to request working beyond retirement”.
The consultation asks whether the Government could provide additional support for individuals and employers in managing without the DRA or statutory retirement procedure. This includes the possibility of future guidance or a more formal code of practice on handling retirement discussions.
Views are also being sought on whether the removal of the DRA could have unintended consequences for insured benefits and employee share plans.
From 6 April 2011 employers will not be able to issue any notifications for compulsory retirement using the DRA procedure. Between 6 April and 01 October 2011, only people who were notified before 6 April, and whose retirement date is before 01 October can be compulsorily retired using the DRA. After 01 October 2011, employers will not be able to use the DRA to compulsorily retire employees. If the employer wishes to use retirement ages they will have to be able to demonstrate that they are objectively justified. Some Examples of jobs where this could possibly be applied include air traffic controllers and police officers.
For more information please contact Simonne McIvor on 01279 758080.
