Default retirement age of 65 to end. ministers confirm

Ed Davey MP: "This will be great for older people, give them more choice, and be a boost to the economy"

The Default Retirement Age (DRA) is to be phased out this year, the government has confirmed.

It means employers will no longer be allowed to dismiss staff just because they have reached the age of 65.

The Department for 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 told the BBC it would still be possible for employers to force people to retire if they were no longer up to the job.

"I think this [change] is really beneficial and should not be the problem some people suggest," he told the BBC.

"As of now, you are still able under the Employment Rights Act 1996 to fairly dismiss someone if you go though the proper processes - and one of the reasons you can dismiss someone fairly includes capability."

Justification

Presently, firms can use the DRA to make staff retire at 65.

Ditching the DRA was first proposed by the coalition government in July last year - largely to tackle issues around the ageing population and the shortfall in pension savings.

And it has now been confirmed following a consultation process.

The change means that from 6 April, bosses will not be able to issue any notifications for compulsory retirement using the DRA procedure.

Between 6 April and 1 October, only those people who were told before 6 April, and who are due to retire before 1 October, can be compulsorily retired using DRA.

Finally, after 1 October, employers will not be able to use DRA to force staff to retire.

However, individual employers will still be able to operate a compulsory retirement age "provided that they can objectively justify it".

The Department for Business gives two examples of where this might be the case - for air traffic controllers and police officers.

It added that it had worked with conciliation service Acas to provide comprehensive guidance for companies on the removal of DRA.

'Uncertainty'

Employer groups had called on the the government to delay introducing the change.

Start Quote

The evidence that performance and effectiveness decline after 65 is just not there”

End Quote Edward Davey Employment Relations Minister

John Cridland, Director-General Designate of the CBI, said the government's new guidance was inadequate and did not deal with how firms could retire staff if they were no longer capable of doing their jobs properly.

"There is not enough clarity for employers on how to deal with difficult questions on performance," he said.

"Less than three months is not enough time for businesses to put in place new procedures.

"The outcome will be more unpleasant and costly legal action," he added.

Mr Davey told the BBC that such fears were exaggerated.

"Two thirds of firms at the moment do not operate a fixed retirement age," he said.

"The evidence that performance and effectiveness decline after 65 is just not there."

Unions have demanded "clear guidance" from both employers and workers to raise awareness of what protection from unfair dismissal and age discrimination older workers will have.

Your comments

I would scrap the concept of retirement altogether. Only people who are not physically or mentally capable of working should be paid by the state - this would ease the burden on taxpayers and employers, improve quality of life of older people and curtail the private pensions industry which is little more than smoke and mirrors.

Alan Findley, Consett

I am 61 this month and I work in administration and welcome the scrapping of DRA, because I am more than capable of working after 65 and want to do so. I don't think because you reach 65 that you are incapable of carrying out your work - I do think this is age discrimination. I know that in manual jobs this would be difficult but in an office environment it would pose no problem and we would also be paying NI and tax and not putting a burden on the government.

Val Redden, Swansea

I am a small to medium size business owner. We need clear guidelines - not everyone aged over 65 is fit enough to keep working after 65. I suspect no win no fee lawyers will be rubbing their hands with this ambiguous legislation. It is hard enough for young people to obtain employment this has got to have an impact on that sector as well.

Trevor Brooks, Woking

I for one totally disagree with the retirement age of 65. I personally think that it should be a choice whether somebody wants to keep working passed the age of retirement age and those that wish to retire at an early age should be allowed to do so. I would like for the government to show the public a statistic report showing those in favour of the retirement age been raised to support their evidence. In my opinion it's a way for the government to pay less out, as the government quote that people are living longer, this only applies to those that can afford to do so.

Leslie Mahon, Leeds

I am 65 in December this year and this is a real help - I work for a local authority I am a father of 11 and 13-year-olds and retaining my job is important if possible. I work as a social worker and social work manager and it is absolutely discriminatory if I were to be put out to grass on the basis of age. If I can do the job competently then it it is my human right not to be dismissed on the grounds of age and I absolutely agree that when I am no longer competent to do so I hope I recognise this early enough- obviously employers do have this concern that the employee does recognise when the time is to go but surely the management of this well too is the mark of a good employer.

Tom Coy, UK

I employ several people in their sixties - some of whom have been with the company for over 30 years. I have trainees who are learning to take over their jobs. My only choice now will be to let the trainees go when they are fully skilled and retain an ageing workforce - until when? Productivity will decline and so will our company. Instead of planning to pass the business on to a new generation the only option will be to close down because of the liabilities the ageing workforce now represents.

Graham Brady, Carnforth, Lancashire

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