Longer working life
Life expectancies have risen to an average of 82 years of age. Despite this, most employers still have the traditional mandatory retirement age of 65 for their staff across the board. This can be set out in a written employment contract, a policy or by practice. As a result of improved standards in health, employees are increasingly looking to work beyond the age of 65 to put themselves and their families on a stronger financial footing when they retire.
This willingness to work will only intensify in the coming years. This is because the gap between retirement age and the age a worker is eligible to receive the state pension is increasing, to 67 in 2021 and 68 in 2028. As a result, compulsory retirement ages imposed by employers are, and will continue to be, a contentious issue for older staff.
Compulsory retirement in Ireland
There is no statutory retirement age in Ireland. Imposing a set retirement age on an employee raises the issue of age discrimination. Whilst it is allowed under employment equality legislation, it is not an unfettered right. Contractual retirement ages must be objectively justified by a legitimate aim and the requirement must be appropriate and necessary to achieve this aim. So, if employers cannot show that their policy is appropriate and necessary based on a legitimate objective, then the requirement will likely be considered discriminatory on age grounds. Employers will have to consider the company's overall business needs and determine the retirement age based on those needs for each class of employees. Recent judgments have outlined a number of reasons which may be considered to objectively justify the mandatory retirement of employees:
Health and safety of staff Career progression to retain staff Increased opportunities in the labour market Maintain an age balanced workforce Succession planning Managing compulsory retirement
If employers choose to have a compulsory retirement age for their staff, or sections of their staff, this requirement must be incorporated into the employment contract in some form. Recent cases have highlighted the importance of how this requirement is communicated to staff and how it is implemented in practice.
The High Court recently dealt with a claim that the requirement was implied in a doctor's employment contract. The doctor had been an officer of the...