Government brings forward plans to look again at what age employees will be forced to retire

A review of the default retirement age, which allows employers to force staff to retire at 65, is to be brought forward by a year, the government announced today.

Ministers had previously pledged to look again at the measure in 2011, but it will now be held next year to respond to “changing demographic and economic circumstances.”

Pensions minister Angela Eagle said most people retired before 65, but 1.3 million chose to work beyond state pension age and many more said they would work past 65 if their employer permitted it.

The minister said it was time to look again at the default retirement age: “Some people prefer to take early retirement, others prefer to keep working. We want to give older people flexible retirement options.

“The government is responding to the changed economic landscape. The different circumstances today – for businesses, and for individuals coming up to retirement – suggest that an earlier review is appropriate.

“As Britain’s demographics change it is sensible that we have the debate on what works for business and individuals. The retirement laws need to reflect modern social and economic circumstances.”

TUC general secretary Brendan Barber welcomed the announcement. He said: “It cannot be right that an employer can sack someone simply for being too old. Employees should have choice – neither forced by employers to give up work, nor forced by inadequate pensions into working longer than they should.

“A key challenge as we live and stay active longer is developing the right kind of jobs, support and training for older workers.”

Michelle Mitchell, charity director for Age Concern and Help the Aged, described the move as a “step in the right direction,” but said it was not enough.

“The government should immediately put a stop to an arbitrary and unfair rule which stops people from working, simply because of their age.

“Older workers make a huge contribution to the economy and will have the skills and experience needed to boost recovery as we come out of recession.

“Many older people want to be able to continue to work beyond 65. For some this is because they need to boost their pensions or simply pay the bills, but for many it is because they love their jobs and see no need to stop working when they can still do them well.”

Legal challenges

Earlier, a panel of judges heard that a legal challenge by a solicitor forced to retire at 65 could affect every employee in the country.

The government has intervened in the case of Leslie Seldon, who claims he was discriminated against on grounds of age when his firm, Clarkson Wright Jakes, asked him to leave at the normal retirement age in line with his partnership agreement.

Dinah Rose QC, acting for the Department for Business, Innovation and Skills, said the case raised “important questions of policy and principle”.

The Equality and Human Rights Commission is intervening in a separate legal challenge next Thursday in the High Court over compulsory retirement in a case brought against the government by Age Concern and Help the Aged. It will decide if the UK’s default retirement age can be justified under EU law.

Scores of age discrimination claims are waiting in the pipeline for the outcome of these challenges. The judges will reserve their ruling tomorrow.