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Government plans to scrap fixed retirement age from October 2011
The government will launch a consultation process today to look at plans to scrap the default fixed retirement age for the UK's workforce.
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More FTSE charts & pricesby Matthew Goodburn on Jul 29, 2010 at 07:31
The government will launch a consultation process today to look at plans to scrap the default fixed retirement age for the UK's workforce.
Subject to the consultation paper, The BBC is reporting that from October 2011, employers would not be able to force employees to retire at 65 without offering them financial compensation.
The change in the rules would mean that the employer's only obligation would be to hold a meeting with a member of staff to discuss their options at least six months before they reach 65.
As an employer must give six months notice before someone is made to retire on age grounds, the change in the rules could become effective from 6 April next year.
The CBI has hit out at the proposals, saying they would leave many companies little time to make provisions for the change.
Paul Mander, partner and head of employment, Dawsons Solicitors, said: 'The changing social and financial landscape was always going to make it difficult for the Government to maintain a default retirement age (DRA) of 65 under age discrimination legislation.'
'With an ageing population there has been increasing weight to the argument that a one size fits all retirement policy is no longer acceptable, and that you can no longer say that people aged 65 or over are incapable of carrying out their jobs to the standards expected.'
'Many employers will be deeply concerned by the announcement. Up until now employers have relied heavily on the default retirement age to enable people to retire with dignity or to remove the older workers who they feel are ‘underperforming’.
Removing the DRA of 65 will give employers a major headache, and will force them radically to alter how they manage their workforce.'
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13 comments so far. Why not have your say?
Gary Shorthouse
Jul 29, 2010 at 09:39
Of course it is good for those who wish to continue, but I feel for those others who are looking forward to retirement but now will be pressurised by their spouses and others to continue to work in order to maintain income levels.
Retirement is great - I did it three years ago and life has never been so good or in fact so busy.
report thisWilliam Roger Masheder
Jul 29, 2010 at 09:44
As a small business I see this as the goverment again shedding its promised responsibilities to the aged and forcing its decisions and further costs onto an already financialy stretched small business sector
report thisGrumpy Old Man
Jul 29, 2010 at 11:24
What about the youngsters who will struggle even more to find jobs?No-one seems to mention them.
report thisIvor Nestegg
Jul 29, 2010 at 11:55
This is the old old story, the quick fix solution that wipes out Pension Fund Deficits at a stroke by forcing people to work longer.
The snags are;:
a) Where is all this "work" meant to come from.? Private sector employers have been slashing payrolls and are not about to start re-hiring. Now the Public Sector is set to do the same.
b) As Grumpy Old Man says, how are young people meant to find jobs if the older members of the work force are forced to stay on past retirement age?
report thisBob
Jul 29, 2010 at 13:34
This will present real problem for all businesses tho' it will probably hit smaller businesses hardest of all. Put shortly, how do they get rid of someone whose performance has fallen off because of age? The fall off might be some way short of being so bad that the persons concerned are just unemployable so that terminating the employment might not be easy to evidence in the course of a Tribunal hearing. I can envisage people, in effect, entering retirement at the expense of their employers, keen to stay on for the "retirement" income that is provided but being essentially just passengers. Given the fact that many 65 year olds actually occupy reasonably senior, well paid jobs, this could be a real drain on an employer's finances, especially when they might wish to promote younger, often more dynamic people to the senior position. And if we are being honest with ourselves (and I write as a 70 year old who retired three years ago and who still does some part time work), most of us would admit that we were more dynamic in our forties and fifties than we were in our sixties.
It's a big problem but I am not absolutely sure that it can be dealt with just as easily as this suggests.
report thisjohn j kelly
Jul 29, 2010 at 16:09
I wanted to continue working in the Civil Service after age 60 in 2000, under a then Labour government initiative. I was given an indefinite extension which lasted 6 months. All the jealousies and imagined problems came to a head in the Personnel Department and they & the government chickened out! Shame on them! However I am really enjoying a happy retirement and feel that everybody should have the choice of early or late retirement as the fancy takes them, without being imposed upon! Well done the New Coalition Government!
report thisJane O'Dwyer
Jul 29, 2010 at 18:17
I think that changing the law will not make a blind bit of difference, as Companies will find a way of focing these people out by different means. For example, some companies already get rid of employees by "restructuring" their job, making them reapply for it, and giving it to somebody else. In some cases the only thing that changes about the role is the job title, or that they have to file 3 more letters a day. Rediculous - it will be interesting to see if this practice suddenly increases when the law kicks in.
report thisAnonymous 1 needed this 'off the record'
Jul 29, 2010 at 19:50
the judge got it write smack on the nose.
stop the pen pushers who have easy jobs keeping the kids out of work. manual workers need to retire before they die on the job or kill some one else. a lot oof these people who dont want to retire are selfish who dont care about giving other people a chance to earn more money in middle age by promotion. i can understand people who have been on low pay who cant afford to retire but well off peolple on good pensions need to have a word with them selfs if they think work is all you need in your life
report thisterry squires
Jul 29, 2010 at 20:57
i am a 70 year old, still working (up to December 2010) when I will retire, or preferablly from my point of view, continue on a reduced time and pay basis. I am aware that I need perhaps to move over for younger people to enter the workforce, but at the same time I have skills, energy and experience that offer value. I feel what is needed is flexiblity in employment forms to allow this, where appropriate.
report thisgeorge mckay
Jul 30, 2010 at 11:03
i do not mind working until i am 100 if were lucky enough to get there i think mr pm and mr cleg should give up there personal fortunes that they have and try to live on what us old people have to put up with and they should be made to work until they drop not sneak of with gold plated pensions and be means tested what a way to run a navy they have an awful cheek telling us to pull our belts in they should remeber what happened to a lady pm when she pushed the working class to far so beware mr pm and mr cleg.!!!!
report thisJon Gallagher
Aug 02, 2010 at 00:48
Wont this lead to years of jobs being unavailable for graduates and school leavers with even more unemployment. Working for a large organisation we recruit 60 graduates and yong people each year due to retirals. This will now disappear or be put on hold for 3, 4 or 5 years or more.Older workers are however more reliable, stay with you and are absent less. Not sure if it will work in physically demanding jobs though. I operate the DRA and find most older workers dont want to retire, even those who are on sick leave and have been deemed medically unfit to continue, dont accept the findings from OHS and request to stay on for another year.
report thisIanADW
Aug 03, 2010 at 15:01
The majority of objections to waving the forceable retirement age have also been made to all of the other types discrimination in the workplace that we've come to accept over the past 40 years - discrimination because of gender,sexual orientation, race, youth, have all now been swept aside to make us the fairer, more equable society that we have today.
Age is the final anti-discrimination frontier and speaking as someone approaching 65 who has had to adjust my own views on many subjects over the years -"it's my turn now". The decision on when anyone should retire should be be entirely up to the individual rather than some archaic rule. For some oit's a great idea at 50; for others it's equally good at 70 or beyond, provided that you can still do the job well.
report thisJon Gallagher
Sep 03, 2010 at 21:13
I have recently had a request from an employee of 67 to stay on yet another year but yet she has been complaining that the job is too physically demanding and cannot cope. It makes you wonder.
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