The Court of Appeal has indicated the approach the courts are likely to take with regard to retirement dismissals following the abolition of the Default Retirement Age (DRA) of 65 from October 2011.
The Government consultation on its abolition closes on 21 October, but if the proposals go ahead as expected, employers will no longer be able to rely on a default retirement age of 65. Retirement dismissal will still be possible if it can be objectively justified.
The case concerned a law firm which retired an equity partner at 65. Equity partners, not being employees, are exempted from the DRA, so the firm had to objectively justify the retirement dismissal in the same way that employers will have to if the DRA is abolished.
The court ruled that the retirement age pursued the legitimate aims of workforce planning and the creation of a congenial working atmosphere. The fact that another age might have been less discriminatory did not prevent retirement at 65 being a proportionate means of achieving those aims, therefore the employer was not liable.
Should the DRA be abolished, employers will have to provide detailed evidence of why it is necessary to have a particular retirement age, and show how it helps achieve their organisation’s legitimate aims.
Seldon v Clarkson Wright and Jakes