Default Retirement Age

14 January 2011

In August 2010 we reported that the Government had proposed plans to phase out the Default Retirement Age (DRA). The DRA stipulated by the Employment Equality (Age) Regulations 2006 is currently 65. The Government has now confirmed that the DRA will be phased out from 6 April 2011, and will be completely abolished on 1 October 2011.

The Government’s proposals are:

·         From 6 April 2011, no new notices of intended retirement can be issued and from 1 October 2011, there will be no retirements under the default retirement age.

·         Only retirements notified before 6 April 2011 to take effect before 1 October 2011 can be compulsorily retired using the DRA.

·         After 1 October, employers will only be able to operate a compulsory retirement policy if it can be objectively justified.

Employers are required to provide six months’ notice of compulsory retirement, any notifications given after 30 March but before 6 April will be on a ‘short notice’ basis. ‘Short notice’ of at least two weeks is allowed under the current scheme; however an employee may be able to claim compensation.

Acas has worked alongside the Government to develop a comprehensive guidance to help businesses adapt to the change.