Recent legislative changes would suggest we’ve said goodbye to retirement – but don’t be so sure, says Rachael Jessop
Since the abolition of retirement on 5 April, employers could be forgiven for thinking the only consideration they now have is how to manage the effect, if any, that retaining older employees will have on their workforce profile. Unfortunately it is not as simple as this, as can be seen from the impact of two recent Employment Appeal Tribunal decisions.
The first case concerned the employer's duty to notify the employee of the intended date of retirement. The EAT held that the employer had failed to comply as it had not advised the employee of the essential conditions attached to his right to work. This meant the dismissal could not be deemed to have been for reason of retirement and was held to be unfair.
What does this mean for employers? If the necessary information has not been given to the employee and he or she subsequently brings a claim on that basis, the employer is likely to face a claim for unfair dismissal. There is potential for a financial award and employers could face real financial problems if several employees bring these claims.
Unfortunately, the last date to issue new notices was 5 April 2011, so the notifications cannot be changed to be made legally compliant. Instead, employers may wish to review recent and pending retirements and if they are concerned statutory procedures may not have been followed, may take advice.
The second case concerns the consideration of an employee's right to remain in employment after retirement. The EAT held that the employer must consider the request 'in good faith'. The employer asserted that it had already decided the blanket policy would applyrigidly. As a result, the dismissal was found to be unfair.
Employers should note that the last possible date an employee can apply for an extension to remain in employment is 4 January 2012. In the meantime, requests must be considered with an open mind.
It is clear that employers may still be caught out by old retirement laws despite their apparent abolition. Employers would be well advised to review recent and pending retirements in light of this.
Rachael Jessop is a solicitor at Floyd Graham & Co
Since the abolition of retirement on 5 April, employers could be forgiven for thinking the only consideration they now have is how to manage the effect, if any, that retaining older employees will have on their workforce profile. Unfortunately it is not as simple as this, as can be seen from the impact of two recent Employment Appeal Tribunal decisions.
The first case concerned the employer's duty to notify the employee of the intended date of retirement. The EAT held that the employer had failed to comply as it had not advised the employee of the essential conditions attached to his right to work. This meant the dismissal could not be deemed to have been for reason of retirement and was held to be unfair.
What does this mean for employers? If the necessary information has not been given to the employee and he or she subsequently brings a claim on that basis, the employer is likely to face a claim for unfair dismissal. There is potential for a financial award and employers could face real financial problems if several employees bring these claims.
Unfortunately, the last date to issue new notices was 5 April 2011, so the notifications cannot be changed to be made legally compliant. Instead, employers may wish to review recent and pending retirements and if they are concerned statutory procedures may not have been followed, may take advice.
The second case concerns the consideration of an employee's right to remain in employment after retirement. The EAT held that the employer must consider the request 'in good faith'. The employer asserted that it had already decided the blanket policy would applyrigidly. As a result, the dismissal was found to be unfair.
Employers should note that the last possible date an employee can apply for an extension to remain in employment is 4 January 2012. In the meantime, requests must be considered with an open mind.
It is clear that employers may still be caught out by old retirement laws despite their apparent abolition. Employers would be well advised to review recent and pending retirements in light of this.
Rachael Jessop is a solicitor at Floyd Graham & Co
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