10 Nov Retirement Ages

Retirement issues continue to be problematic and costly for many employers. This short article deals with some of the typical queries that I get on this issue.

Q – Is there a standard employment retirement age for employees in Ireland?

A – There is no standard or mandatory retirement age in Ireland but employers may legally set a retirement age in their contract of employment. However the retirement age must be objectively justified by a legitimate aim and the means of achieving this aim must be necessary and proportionate.

Q – What would be an acceptable objective justification for a retirement age?

A –  An employer must be able to support a legitimate aim in setting a retirement age that is specific to the circumstances of their business rather than to individual employees. The means of achieving this aim must be reasonable and it needs to be considered whether there are other ways that it can be achieved other than through the setting of a mandatory retirement age. For example in safety critical roles that involve a level of physicality, it is likely to be easier to justify a mandatory retirement age in order to protect the safety of employees and customers than in roles that are sedentary. 

The following are examples of potential objective justifications for setting a retirement age:

• Succession Planning
• Health & Safety Concerns
• Developing a balanced age profile in workplace
• Creation of promotional opportunities.

Q – How can I avoid a potential age discrimination claim?

A – Firstly it is critical that the standard retirement age is set out in the contract of employment and applied consistently across the organisaiton, as custom and practice will be very relevant to being able to successfully defend a claim of age based discrimination. This as outlined above also needs to be objectively justified according to the specific circumstances of each organisation.

Q – How can I employ someone past their retirement age?

A – When an employees asks to work past their retirement age, it is important to consider on what basis this might be agreed to and that it is objectively justified.  All such requests should be dealt with on a case by case basis and care taken not to undermine an existing retirement policy through inconsistent application or decisions taken to allow employees work beyond retirement age without any justification. In the event that an extended period of employment beyond retirement age can be justified, a  fixed term contract that is subject to a health assessment can be used. However care should to taken to ensure that a series of fixed term contracts does not give rise to a contract of indefinite duration as provided for the Protection of Employees Fixed Term Legislation.

If you would like some further advice on retirement ages please contact me at info@hrsolutions.ie.