HCS Business Matters
20th October 2009
What to do when an employee reaches 65?
The ongoing debate as to whether it is, or is not unlawful to dismiss an employee when they reach retirement age continues to cause confusion amongst employers and employees alike.
On 26th September the high profile Heyday case concluded that a default retirement age of 65 is not unlawful. This means that employers can now retire an employee upon turning 65, without having to provide a redundancy payment, without fear of accusation of age discrimination, and despite the employee potentially not wanting to retire.
However, employers must still follow the statutory retirement process to ensure they are compliant with current legislation, and avoid potential claims.
HCS recommends that as an employer you should:
- Implement a Retirement Policy within your company. This will ensure all employees know what to expect when they reach their “golden years,” and employers follow the correct procedures to lawfully exit their employees from the business.
- Provide employees reaching retiral age with full written notice of their retirement date, to enable them to consider their options
- Consider offering employees the ability to voluntarily reduce their working hours as they approach retiral, in line with business requirements.
- Bear in mind that it may not always be beneficial to retire your employees when they reach retirement age. These employees potentially have valuable experience and skills plus a wealth of life experience they could continue to offer your organisation. There are currently 1.4 million people working past the age of 65 in the UK.
- You are obliged to consider all requests from employees who have reached 65 under a “duty to consider” procedure.
To get a step-by-step guide on Managing Employees to Retiral, and your responsibilities as an employer, please visit the HCS website at www.humancapitalservices.co.uk and follow the links on our home page.
FACT: As we live in an ageing population, it becomes increasingly likely the Government will raise the UK retirement age further when they review the current retirement legislation next year.
Call HCS today on 0141 776 6456 for assistance in developing a new Retirement Policy, reviewing your existing policy or coaching your employees on how to manage employees as they approach retirement.
14 January 2010, webeditor
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