April 2011 was an important month for many tens of thousands of older workers. It effectively meant the beginning of the end for the default retirement age. If employers had not given the necessary 6 months minimum notice of requirement to retire an employee by this date, then they would no longer be able to do so. The default retirement age has come to an end and employers will need to rely upon effective appraisal systems to manage their workforce, rather than having a ‘convenient’ cut off age when they could just retire people with no questions asked. This measure which was part of the ‘coalition agreement’ after the last general election reversed the decision of the previous Labour government to bow to pressure from employers to retain a compulsory retirement age.
Back in 2006, mostly as a response to the requirements of a European Union directive, the Labour government adopted the Employment Equality (Age) Regulations which were aimed at ending age discrimination in employment. Although these Regulations were a major step forward for those who oppose discrimination which is based solely on the chronological age of an individual, they also took a major step backwards by introducing the default retirement age.
The Regulations gave employers the option of adopting a process where they could force employees to retire on, usually, their 65th birthday without the employee having any recourse to claims of unfair dismissal or age discrimination. Evidence that the Government has been sympathetic towards the employer’s agenda in dealing with age discrimination is provided by the responses to the 2005 consultation on its draft age regulations, called Coming of Age. The Confederation of British Industry (CBI) stated in its response that the government had produced ‘draft regulations that take business concerns into account’; the Engineering Employers Federation also responded by recording its appreciation that the government ‘has listened to many of the concerns of employers’ in formulating the Regulations. In contrast the TUC stated that ‘the responses of the TUC and the unions to previous consultations have been effectively rejected’.In adopting the policy of introducing a default retirement age the Government had entirely adopted the concerns of employers. The 2005 Consultation document stated that
In setting the default age, we have taken careful note of a number of representations we received in the course of consultations, which made it clear that significant numbers of employers use a set retirement age as a necessary part of their workforce planning. Whilst an increasing number of employers are able to organise their business around the best practice of having no set retirement age for all or particular groups of their workforce, some nevertheless still rely on it heavily. This is our primary reason for setting the default retirement age (italics added).
The CBI continued its opposition to removing the compulsory retirement age even after the coalition government announced its intention to end it. Mr John Cridland, Director General of the CBI, said in a 2010 press release that “With the scrapping of the DRA in April, a legislative void is opening up. We need to modernise our employment law framework to ensure that it is fit for purpose. In the majority of cases this will not be an issue, but in a minority it will be a serious problem for all concerned”.
It would, however, have been an injustice to continue with this blatant piece of age discrimination. Age UK estimates that some 100,000 people were forced to retire in 2009 and stated that ‘the harm this causes to those who wish to work beyond retirement age, both financially and in terms of the impact on the person’s self-determination, should not be underestimated’.There is plenty of evidence that once older people lose their jobs, it is almost impossible for them to get back into the labour market.
Obviously many people look forward to retirement and do retire at an age when they can still continue to have an active retirement. There are others, however, who do not wish to stop working, sometimes for financial reasons and sometimes because work is such an important part of their lives. Ending the default retirement age is about taking the decision away from the employer and giving choice to the individual, so that the individual can decide whether to continue in paid work or not. Compulsory retirement has not gone altogether though. There is still the possibility for employers to have a compulsory retirement age, but they would need to objectively justify it, and this will be difficult. In the meantime many people next year and in the following years will be grateful for this decision of the coalition government and for their willingness to resist employer pressure.
