Creating a fairer Britain
The Employment Equality (Age) Regulations 2006 (the Regulations) came into force on 1 October 2006. The Regulations implemented the November 2000 European Directive outlawing age discrimination in employment and vocational training. However, the Government restricted the protection available to people over the age of 65 by creating a new 'default retirement age' of 65 for both men and women. This permits employers to set a 'mandatory retirement age' at or above the age of 65. Employers will only be able to justify forced retirement under the age of 65 in exceptional circumstances.
In practice it means an employer can compel its employees to retire at or after 65 and can refuse to recruit anyone over the age of 65. It is lawful for an employer to force employees age 65 or over to retire as long as they follow the correct procedure, which includes giving the employee between six and twelve months notice. Employees have the right to request to continue working beyond the date when the employer wants them to retire, but the employer can refuse the request and the law does not require them to give any reason for that decision.
The charity Age Concern and Help the Aged (Age UK) sought a judicial review of the Employment Equality (Age) Regulations 2006 just after the Regulations were published. The case against the UK Government argued that the Age Regulations had improperly implemented the EU’s 2000 Equal Treatment Directive by including a national default retirement age applicable to all UK workers. The judicial review also challenged the linked exception relating to the recruitment of employees near or over age 65 and the scope for justification of direct discrimination on grounds of age.
The High Court needed clarification on how the EU Directive should be interpreted and so made an order referring five questions to the European Court of Justice. The wording of the questions was agreed between the DTI (later BERR and now BIS) and the charity and were endorsed by the High Court. The European Court of Justice published its judgment in March 2009, in which it made it clear that the UK government has to meet a high standard of proof in demonstrating that its default retirement age is justifiable on grounds of social or employment policy.
The case returned to the High Court and a hearing was held on 16-17 & 20 July 2009. The Commission used its legal powers to intervene in the case, so that it could support the charity’s claim with additional evidence and legal arguments. The charity and the Commission presented evidence and legal arguments on one side, and the Government on the other. The ruling on the case was made on 25 September 2009.
The judge decided that the Default Retirement Age (DRA) was lawful when it was first introduced, so the law will stay as it is. However, the judge also said that there is now a ‘compelling’ case for setting the age higher than 65. Mr Justice Blake recognised the ‘very substantial weight’ of the arguments put forward by the Commission and Age UK to stop people being forced out of work at 65.
In explaining his ruling he said he took into account the Government’s move to bring forward a review of DRA from 2011 to 2010. This review will consider whether a Default Retirement Age is still 'appropriate and necessary'. By 2011 the Government will have scrapped mandatory retirement ages for all but the most senior of its civil servants.
He also observed that a DRA of 65 would be unlikely to be lawful if it was introduced in 2009 because of the state of the economy. However, his decision to allow a DRA of 65 was based on the circumstances and evidence available three years ago when it was introduced.
The Commission will continue to ask the Government to abolish the DRA using the Equality Bill, which is soon to be debated in the House of Lords, rather than wait until a review of the policy next year. The Equality Bill will consolidate all discrimination law, including the Age Regulations, into one Act of Parliament. The Commission is asking for the Bill to be amended so that it ends the Default Retirement Age. The Bill will resume in the House of Commons in the autumn, after the High Court judgment. In the New Year, the Bill will move to the House of Lords and is expected to receive Royal Assent in April.
The default retirement age of 65 set in the Employment Equality (Age) Regulations is not compulsory. Employers still have the choice whether or not to have a normal retirement age for their employees. Employees have the right to ask to carry on working beyond the age of 65 even if their employer has a normal retirement age in place.
Hundreds of older workers have cases on hold at the Employment Tribunal awaiting the outcome of the case. These claims for compensation for age discrimination and unfair dismissal related to forced retirement can now move forward. The Employment Tribunal will have to take into account the Judge's observations on the legality of a DRA of 65 in 2009 when considering these cases.