Do you have employees who are 65 or over on 30 September 2011 who you wish to retire without the risk of adverse dismissal or discrimination claims?

If so, you only have a few weeks left to do so as you must give notice of compulsory retirement to such employees by 5 April 2011 at the latest.

The notice period must be between 6 and 12 months. The latest date therefore for your employees to retire would be 4 April 2012.

Your employees can request to work beyond that date but only if they have made a request before 5 January 2012. Provided the extension is no more than 6 months you will not run the risk of adverse claims when they finally leave.

The latest date you can retire an employee using the default retirement age if they request their retirement date to be postponed is 3 October 2012.

If you do not plan to retire any employees what steps do you need to consider to prepare for the phasing out of the default retirement age from October 2011?

The effect of the regulations will be that retirement as a defence to unfair dismissal will be removed as it will as an exception for age discrimination.

Employers therefore will need to consider whether to keep a fixed retirement age after October 2011 which could be objectively justified or to have no fixed retirement age at all.

In that case employees reaching 65 will continue to work on or they can retire voluntarily at a time of their own choosing. All employees will be treated the same regardless of age but any dismissal would still have to be for a fair reason and follow a fair dismissal procedure.

We recommend that management consider and implement the following steps so that retirement in the workplace can be properly planned for:

  1. Undertake a workforce planning exercise by completing a workforce audit by age and structure and examine staff turnover rates.
  2. Adopt a consultation procedure to discuss with employees their aspirations and plans for the future.
  3. Liaise with workforce committees or other bodies to discuss their views about fixing the retirement age or having no fixed retirement age.
  4. Consider the current policies in place to deal with capability, performance, appraisals and training.
  5. Review all employment related documentation to delete any reference to age.
  6. Review the capability, performance and appraisal policies to ensure they are robust but fair.
  7. Consider any other associated documents such as share option plans to ensure they are not discriminatory.
  8. Consider the benefits provided to employees such as health insurance cover and whether these should and can be provided for all employees.
  9. If a compulsory retirement age is to be operated, all the evidence to support this should be collated and the reasons documented, so it can be objectively justified as a proportionate means of achieving a legitimate aim if challenged.