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The Age of Equality: Part 2
The Employment Equality (Age) Regulations 2006 come into effect on 1st October 2006. In last month's issue we considered the different types of unlawful discrimination, whether age can be a genuine occupational requirement, objective justification and the specific exemption for service related benefits. In this issue we consider how the regulations will impact upon retirement, the duty to consider requests to work beyond retirement, unfair dismissal and redundancy. |
Retirement age
Retirement at or over the age of 65 ("the default retirement age's will not be discriminatory however, employers who currently set a lower normal retirement age, for example at age 60, will be required to raise it to 65 unless they can justify the lower age.
The DTI consultation document "Coming of Age" indicated that justifying a retirement age of less than 65 would be difficult. Certainly, experience from jurisdictions where age discrimination is already prohibited, tends to support this view. In Australia, a 60 year old airline pilot argued successfully that his retirement was discriminatory on the grounds of age. Many countries have a 60 year old age limit for pilots; the airline came unstuck because they failed to explore other employment opportunities which, in turn, effectively forced the employee to retire (Christia v Quantas).
There may, however, be situations when a lower retirement age can be shown to be "a proportionate means of achieving a legitimate aim" for example, to increase the turnover of staff so that an employer can recruit a workforce which is more balanced in terms of gender and ethnicity. Only time, and lots of case law, will clarify when lower retirement ages may be justified.
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Notice of retirement
Employees will have the right to make a request not to retire. The "duty to consider" procedure will allow employees to request working beyond a compulsory retirement age. To ensure that employees know about their right to make a request, the regulations provide that employers must notify employees of the intended date of retirement and of their right to request working beyond retirement.
This notification must take place at least 6 months, but not more than 12 months, before the intended retirement. An employer who fails to 'notify' during this period can be ordered to pay up to 8 weeks pay (capped at the statutory maximum - currently £290pw) to the employee by an Employment Tribunal. So an employer who fails to write a letter at the correct time is exposed to liability of £2,320 per employee.
What is more, the duty to notify continues, and if an employer has still not sent the notice at least 14 days before the date of retirement, the retirement will become an automatically unfair dismissal.
As it will be impossible for employers to fit 6 months notice in prior to retirements which take effect during the first 6 months after the regulations come into force, there are detailed transitional provisions dealing with when notices must be sent in the first 6 months of the new regime.
For further details contact Adrian Berkeley on 0161 371 0011.
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