Default Retirement Age Upheld

The High Court has upheld the law that allows UK employers to force workers to retire at the age of 65.

As the law stands, a British employer can dismiss a member of staff without redundancy payments on that person's 65th birthday, as long as they stick to the correct procedure.

The Heyday case (R (on the Application of Age UK) v Secretary of State for Business, Innovation and Skills [2009] EWHC 2336), concerns whether the default retirement age of 65 in regulation 30 of the Employment Equality (Age) Regulations 2006 is contrary to the Equal Treatment Framework Directive (2000/78/EC) .

On 25 September 2009 the High Court handed down its decision. The decision follows a reference to the ECJ, which gave its judgment in March 2009.

The High Court dismissed the challenge. It held that regulation 30 had been implemented to pursue legitimate social policy objectives concerning the labour market, and was proportionate, bearing in mind the UK Government's "margin of discretion" in implementing the Directive in 2006.

While the default retirement age of 65 therefore remains lawful for now, the court found the arguments against it compelling, and made a number of comments which suggest that it may not survive for much longer.

One factor that helped the court decide that the legislation, although prima facie discriminatory, met the test of proportionality was the fact that the Government had always promised to keep the situation under review. The court considered that any attempt to keep a default retirement age of 65 beyond that review (now scheduled for 2010) is unlikely to pass the test. Its reasons are encapsulated in this short quote from the judgment:

"It creates greater discriminatory effect than is necessary on a class of people who both are able to and want to continue in their employment. A higher age would not have any detrimental labour market consequences or block access to high level jobs by future generations. If the selection of age 65 is not necessary it cannot therefore be justified".

Full report to follow in the October Edition of ESsential News