Monday, January 07, 2008
Retirement Age Rules
The default retirement age exemption in the Employment Equality (Age) Regulations 2006 allows employers to retire employees at 65, as long as the employer follows a set procedure
The National Council on Ageing, operating as the Heyday Group, is challenging this exemption, claiming that the exemption is inconsistent with the European Directive on age discrimination.
The European Court of Justice (ECJ) is not expected to reach a decision in this case until early 2009. The outcome of the Heyday case will depend on the facts of the case and whether the ECJ is persuaded that the
UK government can justify the default retirement age. Meanwhile, Employment Tribunals have had to decide whether to freeze age discrimination cases, pending the outcome of this case.
An employer,
Solent, retired an employee, Mrs. Johns, in 2006 by following the retirement process laid out in the Age Regulations. Mrs. Johns was over 65 and Solent decided that the default retirement age exemption in the
UK age regulations applied.
Mrs. Johns brought a claim against her employer for unlawful age discrimination and unfair dismissal, arguing that her claim should be put on hold pending the ECJ's decision in Heyday.
The Tribunal rejected her argument and struck out the claim on the basis that it had no reasonable prospect of success. Mrs. Johns appealed to the Employment Appeal Tribunal (EAT) who overturned the Tribunal's decision and froze her claim, pending the decision in Heyday.
It appears that the EAT found that, if the Heyday challenge does succeed, Mrs.Johns would have a reasonable prospect of winning her claim.
Following this decision, the president of the Employment Tribunals has directed that all claims of age discrimination relating to the default retirement age should be put on hold pending the outcome of the Heyday case.
It is clear that employers are now at risk if they compulsorily retire employees, even where the employer has relied on the default retirement exemption and followed the retirement process set out in the regulations.
Many observers are suggesting that employers should consider carefully whether to terminate employment on retirement grounds or to consider other potential reasons for dismissal.
Back