Legal ruling means small companies can still retire their staff at 65 – for now
A leading North West law firm is urging small firms to pay close attention to retirement age law after the High Court ruled that the current default retirement age of 65 is lawful – for now.
Mace & Jones head of employment law Martin Edwards said the ruling meant that employers are now able to compulsorily retire employees aged 65 and over.
“Bosses can now retire someone on ground of age at 65 providing the statutory retirement procedures are complied with,” he said. “Critically this means employees will not be able to claim unfair dismissal or age discrimination. We understand that this is the end of the Heyday test case claim as it is not to be appealed. Those employers with current claims from employees who were retired which have been stayed by the Tribunals awaiting this decision, are likely to see the claims dismissed in the near future.”
But Mr Edwards warned that while this reinforces the current rules for now, the Government has brought forward its review of the default retirement age to next year.
“It is possible that we will see the ability to compulsorily retire abolished altogether in the near future,” he said. “Some of the comments in this judgment may make it difficult for the Government not to increase the retirement age to at least 68 or 70. Moreover the Equalities and Human Rights Commission has asked the Government to amend the Equality Bill, which is currently going through Parliament, to abolish the default retirement age altogether.”
Mr Edwards said the case again showed the vital need for bosses to take professional advice when dealing with employment law issues.
“As this case shows employment law is complex and changeable,” he said. “Furthermore given its nature employment law is unfortunately very easy to get wrong for employers. And if you do get it wrong the consequences can be disastrous with costly, time consuming and disruptive cases wreaking havoc with the operations of a business or organisation. For this reason it is essential to tread with care and seek specialist help.”
Posted September 28, 2009
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