U.K. abolishes default retirement age

Employees will no longer be forced to retire at 65 as of Oct. 1, 2011
|Canadian Payroll Reporter|Last Updated: 01/18/2011

The Default Retirement Age (DRA) will be phased out in the United Kingdom between April 6 and Oct. 1, 2011.

The change gives people the freedom to continue working for longer and should also provide a boost to the U.K. economy, said the government in a release.

Currently, employers can make staff retire at 65 even if they are fit, healthy and can still do the job. With people living longer and healthier lives, the government said it wants to give people greater freedom in deciding when to retire.

The last day employees can be compulsorily retired using the DRA will be Sept. 30, 2011. This means that the last day to provide the six months notice required under the DRA will be March 30, 2011.

Employers can still use the DRA between March 30 and April 6, 2011, but will have to use the short notice provisions. Under these an employee could claim compensation subject to a maximum of eight weeks wages.

Between April 6 and Sept. 30, 2011, only people who were notified before April 6, and whose retirement date is before Oct. 1 can be compulsorily retired.

From Oct. 1, 2011, employers will not be able to use the DRA to compulsorily retire employees.

There will still be exceptions to these new rules, however. Employers may continue to have a compulsory retirement age, but must be able to prove it is justified if challenged at an employment tribunal.

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