Significant Anti-Age Discrimination Regulations Come Into Force Today

Today, 6 April 2011, the Employment Equality (Repeal of Retirement Age Provisions) Regulations 2011 come into effect.

Gareth Kervin, Partner at Kervin & Barnes Solicitors (Mayfair, London) says: “The regulations are a significant change in the employment landscape.

He added: “They potentially mark the most significant change in employment law for 20 years.”

As the name suggests, the Regulations mean there will no longer be a default retirement age, with Transitional Provisions until 1 October 2011 by which time the Default Retirement Age of 65 will be phased out.

From today, it will be age discrimination and unfair dismissal to retire an employee as retirement will no longer be a potentially fair reason for dismissal (Employment Rights Act 1996).

The Regulations will completely change the processes employers currently follow when an employee reaches the age of 65 or the employer’s normal retirement age (if higher).

Gareth Kervin, Partner at Kervin & Barnes Solicitors (Mayfair, London) says: “The new Regulations will mean there is no defined end to an employment relationship.

And: “Whereas before, retirement was always a natural conclusion of employment, now, in theory, the employment relationship lasts for life.”

For employees it means they can continue working past the age of 65 or the employer’s normal retirement age (if higher) without the threat of an arbitrary retirement.

Any dismissal on the grounds of age would need to be objectively justified and have very sound reasons.

Gareth Kervin says: “This will give employees much more freedom in deciding how and when they would like to terminate their employment.

He added: “The Regulations effectively put these choices in the hand of the employee rather than the employer.”

Before today, dismissing an employee at or over the age of 65 or the employer’s normal retirement age (if higher) if the reason was retirement was not age discrimination. This provision has now disappeared.

As there is longer a retirement age, the retirement processes in Schedule 6 of the Equality (Age) Regulations 2006 will be repealed.

Only retirements that were notified before today can be compulsorily retired using the Default Retirement Age, providing the retirement procedures that were in place until today were followed correctly.

This means employers can set the retirement date at any time up to 1 April 2012 as long as between 6 and 12 months notice is given and the employee reaches 65 or the employer’s normal retirement age (if higher) on or before 30 September 2011.

So where does that leave employers?

Gareth Kervin, Partner at Kervin & Barnes Solicitors (Mayfair, London) says: “Employers should be very careful in the manner they conduct themselves with aging employees.

And: “The new regulations mean employers are far more likely to be liable for age discrimination and/or unfair dismissal claims.

He added: “From today, there are three options open to employers.

The first option is, instead of retirement, existing potentially fair reasons for dismissal can be used to terminate the employment of an employee at or over the age of 65.

Gareth Kervin says: “These include conduct, capability, redundancy, some other substantial reason or breach of a statutory enactment.

Secondly, employers can rely upon an Employer Justified Retirement Age (EJRA) i.e. setting a contractual retirement age and then starting a procedure to retire an employee who reaches that age.

Having an EJRA would have to be objectively justified as ‘a proportionate means of achieving a legitimate aim’.

Gareth Kervin states that the legitimate aims are generally held to be: “To create a defined career path; to allow retirement with dignity; to facilitate long term employment planning; and the cost burden of employing an older workforce.

He added: “A final possibility is that in limited circumstances the positive action provisions within the Equality Act may be available to an employer.

“If two people applying for the same job are similarly matched to the job, but one candidate comes from an underrepresented age group within the organisation for example, employees under the age of 35, the employer can choose the candidate from the underrepresented group i.e. the younger one.”

So where does that leave employees?

Gareth Kervin, a Partner at Kervin & Barnes Solicitors says: “There is little negative impact of the new Regulations for employees.

He added: “Employees should be aware of the Regulations to ensure their employers are not treating them to their detriment for reasons of age.

Finally: “I don’t believe many employees will insist on continuing working much past the previous Default Retirement Age of 65 for a while as most employees have been set on their retirement for some considerate time.”

For advice relating to the new Regulations or advice on any other employment related issues, contact Kervin & Barnes Solicitors on +44 (0)203 178 5361.