Forced Retirement – Employers Beware!

In a recent decision by the Workplace Relations Commission (“WRC”), an employee of RTE was awarded €100,000.00 when she was forced to retire by her employer at age 65. The employee brought an age discrimination complaint before the WRC under the provisions of the Employment Equality Acts 1998 – 2015.

Background

In the period before the employee turned 65, she had made it known to her employer that she wished to remain in employment for a further 18 months, however this was refused by her employer.

During the hearing in the WRC, the employee presented evidence that her pension provided an annual income of €12,000.00, significantly less than the salary she earned as an employee. In those circumstances, she wished to continue in employment for a further 18 months to get her finances in order. The employee also argued that there was no specific reference to a mandatory retirement age in her contract of employment.

The employer maintained that the objective of having a compulsory retirement age is to ensure “intergenerational fairness across the age groups”.  It was further argued by the employer that if employees are permitted to work past the age of 65, it would prevent a younger generation of employees from progressing in their careers. This would also have a particular impact on the employer and would restrict its ability to produce programmes that are relevant to younger audiences.

The employer also pointed to the fact that they had a well-established policy of mandatory retirement, notwithstanding the fact that it permitted employees to remain working on short term contracts beyond the age of 65 in “exceptional circumstances”.

It was ultimately held by the WRC that there was no legal or contractual impediment to the employee remaining at work with the employer after the age of 65 and that to do so is “in line with government and social policy regarding longer working lives”. It was also determined that the employer could not objectively justify a mandatory retirement age of 65.

Conclusion

The decision in this case highlights the importance for employers to have objective justification to force retirement and that contractual terms are clear and policies regarding retirement are fairly and consistently applied.

How we can help

If you have any queries or concerns, or would like to discuss the above in further detail, please feel free to contact Richard Lee, Partner, in the Employment & Benefits Department of BHSM on 01 440 8300 / rlee@bhsm.ie.

This article is for general information purposes.  Legal advice must be obtained for individual circumstances.  Whilst every effort has been made to ensure the accuracy of this article, no liability is accepted by the author for any inaccuracies.