Retirement

Guide for Employers and Managers

Since the Age Regulations came into force (1 October 2006 to be reviewed in 2011) a company can

• set 65 as a default retirement age

or

• may set retirement age above 65

or

• can choose not to have a fixed retirement age

Employees Rights

Employees now have the right to request to continue working beyond their set retirement date and the employer has a legal duty to give proper consideration to such a request

• any dismissal of an employee before the employee reaches 65 has to be justified
• compulsory retirement below 65 is unlawful unless objectively justified and will be an unfair dismissal
• any dismissal before the age of 65 cannot be deemed a retirement dismissal at all for unfair dismissal purposes . Therefore retirement before 65 can only take place where the employee genuinely and mutually agrees to early retirement
• it is unlawful to insist that a woman retires at a different age to a man

Retirement Process

• between 6 and 12 months before the intended retirement date employers must write and ask whether the employee wants to retire. This is a legal requirement
• the employee may wish to continue working after their intended retirement date and may enter a request into the employer. The employer is legally obliged to hold a meeting with the employee to discuss this request. The employee should be advised at this stage that the employer has the legal right to refuse the request and does not have to give any reason or justification for the decision
• if the request is partly or wholly refused then the employee has the right to appeal
• the employee has the right to be accompanied at any meeting, including appeal, to discuss their retirement

Other Considerations

• calculating final payment taking into account outstanding holiday pay, share option and bonus schemes
• checking the rules of the pension scheme, particularly if the employee is retiring early by mutual agreement
• conducting an exit interview
• recovering company property including computer, mobile phone, car, security passes
• arranging a leaving gift or social event to celebrate the employee’s retirement and length of service with the company
• planning for the pending vacant position or division of duties. Consideration can be given for a new recruit or existing employee to be trained by the retiring employee during the notice period

• set out a standard process and details legal action required by the Employer

APS Letters and Forms

• provide all the legally essential letters and exit forms involved in handing an employee nearing retirement age

Failure to follow a proper procedure could result in the employee making a claim to a Tribunal, where the dismissal will be ruled as “automatically unfair” and the employee may be awarded compensation

APS...planning ahead!

This information should only be used in conjunction with A Personnel Solution terms of use