When setting a mandatory retirement age, employers must consider the potential for discrimination claims on the ground of age. By fixing and enforcing a mandatory retirement age, an employer may be deemed to be treating older employees less favourably than their younger counterparts.
Irish law permits employers to set mandatory retirement ages for employees. The Equality (Miscellaneous Provisions) Act 2015 amended section 34 the Employment Equality Acts by making it a requirement that any mandatory retirement age be objectively and reasonably justified by a legitimate aim, and that the means of achieving that aim be appropriate and necessary. The purpose of this amendment was to bring Irish equality legislation into line with the originating EU Directive and the jurisprudence of the Court of Justice of the European Union.
Recently, the Government has decided not to oppose the introduction of two Bills seeking to further amend this area of Irish law. The Employment Equality (Abolition of Mandatory Retirement Age) Bill 2016, will, if enacted, amend further section 34 of the Employment Equality Acts. In doing so, the amendment will bring an end to the current practice. The amendment would prohibit employers from setting or contracting for a mandatory retirement age. Certain employees (such as members of An Garda Síochána, the Defence Forces, fire services and employees in certain security-related employment) would still be subject to mandatory retirement ages. The Bill would not, however, make it unlawful for an employer to set a voluntary retirement age or to provide financial incentives for the voluntary retirement of an employee at a particular age.
Another recent bill, the Employment Equality (Amendment) Bill 2016, would prohibit the execution and imposition of mandatory retirement as against an employee where that employee can show as a matter of fact, full fitness to work including the ability to carry out the work and tasks for which they are contracted in a satisfactory manner.
If political agreement is achieved on the principle of abolishing mandatory retirement ages (or restricting the application of mandatory retirement ages to certain circumstances) one or other of these bills might be enacted. However, it is likely that the legislation would be in a substantially different form than the form that has been published in the private members bills.
We will monitor progress on these Bills and update you on any developments in relation to their enactment and potential implications for employers.