Regulations which repeal the default retirement age were published last Thursday. They are much as anticipated but there is a problem with the way in which the transitional provisions have been drafted.
Employers may force the retirement of employees who reach the age of 65 between 6th April - 30th September. It seems they may also be able to give 12 months notice to terminate employment up to 5th April 2012 provided in each case that they follow current retirement procedures. However, the transitional provisions don't apply to an employee who has already reached the age of 65 by 6th April.
The implications are that some pending retirements in anticipation of the abolition of the default retirement age may not be safe after all.
Employees who have already reached the age of 65, or who reach that age before 6 April, and are being retired appear to be able to bring claims of unfair dismissal and age discrimination - even if proper procedures have been followed.
Clearly this will cause major problems for employers who have been planning carefully for the abolition of the default retirement age. In our opinion employers have 2 options:-
- Re-visit the retirement with a view to negotiating a compromise agreement with the employee.
- Do nothing and see what happens.
For the time being we advise employers to do nothing. Although Parliament has a track record of not correcting drafting errors (ironically we're thinking of the issues concerning the Equality Act and compromising discrimination claims) this particular error seems to drive a coach and horses through the whole purpose of the regulations.