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Employers want to keep default retirement age of 65

Almost three quarters of employers do not think the default retirement age of 65, should be removed.

The High Court ruling on default retirement is expected later today, but according to a survey of senior managers and HR staff by Eversheds, 73% want to keep the option to enforce retirement in place and only 24% “usually” accept requests from staff to work beyond retirement age.

More than two thirds of employers (68%) consider requests on an individual basis and 8% “usually” decline requests to work beyond 65.

More than three out of 10 employers surveyed (31%) are worried about the capacity of some staff to work beyond 65.

Earlier in summer, the Department for Work and Pensions announced that it was bringing forward its review of the retirement age by twelve months to 2010.

Owen Warnock, employment law partner at Eversheds, said:  “The UK’s decision to retain a fixed retirement age was in response to overwhelming feedback from employers when the legislation was being drawn up. Our research shows that this view hasn’t changed, but it is significant that very few employers view the default retirement age as compulsory. Instead the majority either take time to consider the request or automatically accept requests from those that are keen to continue.

“While most of Western Europe and the US have abolished a default retirement age, they do have some room for manoeuvre. In the US, employers can address performance issues with older workers very easily as there is no protection against unfair dismissal, while pension provision is so generous in many Western Europe countries that people are less incentivised to continue working.

“In our experience, the vast majority of UK employers understand the benefits of a varied workforce and a number of respondents specifically highlighted the value of the experience that older workers bring to a team. Rather than forcing people out of work, employers seem to view it as a backstop to allow for workforce planning and dealing with issues of poor performance. Employers will be watching the outcome of the Heyday decision very closely, with some fearing an increase in age-related discrimination claims due to the lack of clarity it would create if the fixed retirement age is ruled unlawful.”

Source : HR Magazine

 

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