Government 'Must Address The Issue'

The government should do everything it can to address concerns raised about the abolition of the default retirement age, an employment specialist at Irwin Mitchell has urged.

Ed Cotton of the national law firm’s Manchester office commented following growing confusion among many businesses surrounding the “transitional period” prior to abolishing the default retirement age.

Until the draft regulations were published last week the government had indicated that there will be a 6 month transitional period (from 6 April - 30 September 2011) when the default retirement age of 65 and the statutory retirement procedures could be lawfully used.

In January, Acas published guidance relating to the same including a timetable summarising the transitional provisions which prudent employers will now have familiarised themselves with.

However, on 14 February 2011, Acas issued a statement on its website which suggested that the transitional provisions have been revisited, with the option for employers to give 12 months' notice, provided they meet certain conditions. This is reflected in the draft regulations now published with the 6 month transitional period now appearing to have been abandoned.

The draft regulations set new goal posts for using the transitional provisions; the notice of intended retirement must have been issued on or before 5 April 2011, the employee must have reached the age of 65 (or the normal retirement age if this is higher) between 6 April 2011 and 30 September 2011 and the requirements of the statutory retirement procedures must be met.

Discussing the issue, Ed explained: “Employers have been preparing for these changes for some time and may well have acted upon the timetable previously published.

“As it stands, an employer who gives a notice of retirement before 5 April, to an employee who ‘attains’ the age of 65 between 6 April 2011 and 30 September 2011, can follow the current procedures which are in force. However, confusion arises where an employee is already 65 as they will not “attain” age 65 during the relevant window. This must be a drafting error and cannot have been intended by the government. In any event it leaves those employers who have issued notices of retirement to employees who have already reached 65 in a state of confusion.”

“There has been much talk about employers not being supportive of the plans, it is likely that concerns over the transition period and confusion within guidance issued will only exacerbate such problems further.

“What is fundamentally clear though is that employers will be open to claims on the grounds of both age discrimination and unfair dismissal if they do not take note of the changes, so it is undoubtedly an area where they should tread carefully; particularly given the current drafting anomalies.

“We would also urge any firms with concerns about the impact of the legislation to seek advice as soon possible.”