Retirement 



Employers are not allowed to force employees to retire, at 65 or any other age. Employers who want to retire their workforce on reaching a certain age can only do so by agreement – usually by including an express contract term in the employment contract setting out the contractual retirement age (see Chapter 3). If there is a recognised union at the workplace, the contractual retirement age should be a matter for collective bargaining.


Even if there is a contractual retirement age, that is not the end of the matter. The employer still risks engaging in age discrimination unless that retirement age can be objectively justified as a “reasonably necessary means” of achieving a legitimate aim at that particular workplace (HM Land Registry v Benson [2012] ICR 627).



The employer’s ability to force retirement at 65 was removed by law with the abolition of the default retirement age in April 2011.


In Seldon v Clarkson Wright and Jakes No.1 [2012] UKSC 16, the Court identified two broad categories of “public interest” aim, capable of justifying a discriminatory retirement age. These are:



• aims that promote intergenerational fairness: including making it easier for young people to access the workforce and progress, enabling older workers to plan for retirement, sharing promotional opportunities between generations, facilitating workforce planning, promoting diversity and the exchange of ideas and experience, and recognising that older workers have already benefited from the fixed retirement of their older ex-colleagues; and 



• aims that promote dignity: including avoiding the need to dismiss older workers on grounds of incapacity or under-performance. However, national charity Age UK has pointed out that this “aim” is itself based on outmoded stereotypical assumptions about the performance of older workers.



The need to secure the health and safety of workers and the public is a legitimate aim, although employers should avoid making stereotypical assumptions about workers’ physical and mental fitness based on age if there is a more proportionate alternative available, such as a policy of regular health check-ups for each worker past a certain age. 



In Seldon v Clarkson Wright & Jakes (No.2) [2014] IRLR 748, the EAT ruled that a retirement age of 65 was not age discriminatory. However, it is worth remembering that when Mr Seldon launched his legal challenge, it was still possible to compulsorily retire workers at 65. In today’s workplace, many people need to work beyond 65. 



To succeed in a challenge to a retirement age based on age discrimination, it is not good enough for the employer simply to assert a set of “legitimate aims”. Instead they should demonstrate, with proper evidence, that forced retirement is appropriate and reasonably necessary for the needs of their own workforce. 



Here are some important factors to consider when negotiating over a contractual retirement age:



• A tribunal would expect employers to be able to back up assertions with evidence. For example, an employer who suggests that promotional opportunities for younger workers are being held back by the presence of older workers should be able to produce evidence showing this. If there has never been a problem with recruiting and promoting young people, the employer may struggle; 



• the needs of the disadvantaged group should be taken into account when devising any retirement policy. For example, a change to the retirement age is more likely to be reasonable where those affected have been given enough advance notice to plan for the future (European Commission v Hungary [2012] EUECJ C-286/12); 



• a retirement policy negotiated through collective bargaining is more likely to be judged proportionate and reasonable than one that has been imposed on workers (Seldon No.1, Loxley v BAE Systems (Munitions & Ordinance) Limited [2008] ICR 1348);



• the availability (or not) of an adequate pension for someone who is forced into retirement is likely to be an important consideration (Rosenbladt v Oellerking Gebaudereinigungsges mBh [2010] EUECJ C-45/09); and



• a reasonable policy should provide a right to request not to be compulsorily retired. 



Reps should be alert to the risk that some employers may respond to restrictions on forced retirement by misusing formal capability and performance review processes to force out older workers. 



“Flexible retirement” is supported by the TUC and the Chartered Institute of Personnel Development. In some workplaces, unions have negotiated flexible retirement agreements. For examples, see the LRD booklet Representing older workers — a guide for trade union negotiators (www.lrdpublications.org.uk/publications.php?pub=BK&iss=1676).



In June 2014, the right to request flexible working was extended to all employees with 26 weeks’ service. The ability to ask to work flexibly is likely to be particularly useful to employees planning retirement. For details, see Chapter 9.