The default retirement age was introduced in 2006 with the aim of protecting people from being forced out of jobs early. However, an unintended consequence has seen many workers who want to work into their late 60s and even early 70s forced into retirement against their wishes. The coalition announced in January 2011 that it was to scrap the default retirement age with effect from October 2011. This means that since 5 April 2001, retirement notices served under the old regime are no longer valid.
This decision has risked the coalition’s relationship with business. Graeme Leach, director of policy at the Institute of Directors, said: “We greatly regret the government’s decision to abolish the default retirement age. We do not see how the removal of a mechanism that gives employers flexibility in managing their workforce is compatible with the government’s stated desire to boost enterprise and de-regulate the employment arena”.
However, employment relations minister Edward Davey said: “Retirement should be a matter of choice rather than compulsion – people deserve the freedom to work for as long as they want and are able to do so. Older workers can play an incredibly important role in the workplace and it is high time we ended this outdated form of age discrimination”.
We have produced a bulletin on what employers need to think about in this time of change which you can access here.
We would also be really interested to hear what you think about the abolition of the default retirement age and how it will affect your organisation so please comment below.