July 30, 2010
From October 2011 the highly-controversial Default Retirement Age (DRA) will become illegal meaning employees will be able to work past the current 65-year-old limit enforced by many employers.
Described by government ministers as a widely adopted discrimination, the DRA will be phased out from April next year and become fully redundant by October.
The government claims DRA’s abolition is one of a number of measures being taken to help and encourage people to work for longer against the backdrop of demographic and economic change.
“With more and more people wanting to extend their working lives we should not stop them just because they have reached a particular age. We want to give individuals greater choice and are moving swiftly to end discrimination of this kind,” said Employment Relations Minister Ed Davey.
“Older workers bring with them a wealth of talent and experience as employees and entrepreneurs. They have a vital contribution to make to our economic recovery and long term prosperity.”
However, employers will still be able to force elderly workers out the door under compulsory retirement schemes, provided they can “objectively justify” enforcing retirement, the Business Department warned.
In the main, the government’s decision has been whole-heartedly welcomed by campaigners, charities and employees alike. The Chartered Institute of Personnel Development (CIPD), which campaigned against the DRA for years, said it was “delighted” with the “breakthrough”.
"We are greatly encouraged by the new plans laid out to eradicate the DRA. Our research has shown that many employees wish to work past retirement for differing reasons and many employers are already benefiting from allowing such flexibility," Dianah Worman, CIPD’s Diversity Adviser, added.
But business groups claim that the government has given employers little time to adjust their current practices and could result in protracted legal issues in the near future.
“Scrapping the DRA will leave a vacuum, and raise a large number of complex legal and employment questions, which the Government has not yet addressed,” commented John Cirdland, Deputy Director-General of the Confederation of British Industry (CBI).
“A default retirement age helps staff think about when it is right to retire, and also enables employers to plan more confidently for the future. In certain jobs, especially physically demanding ones, working beyond 65 is not going to be possible for everyone.”
