Maintaining an employer-justified retirement age?

Topic Index
Overview
ACAS guidance on employer justified retirement age (EJRA)
EU v UK cases
Conclusion

Overview


  • Christine Jenner, employment partner at DAC Beachcroft, sets out a checklist for HR managers of the issues they should consider when considering whether to retain a retirement age after the abolition of the Default Retirement Age (DRA).
  • Employers have two options after DRA is abolished on 1 October 2011; either to stop operating a retirement age altogether, or continue to have a compulsory retirement age. If they opt for a compulsory retirement age then they must be able to show it can be objectively justified – an employer-justified retirement age (EJRA).
  • To have an EJRA, employers must show that it is a proportionate means of achieving a legitimate aim. Providing a tribunal with a legitimate aim itself is not too problematic. The difficulty lies in demonstrating that adopting a retirement age is proportionate and reasonable in the circumstances in order to achieve the legitimate aim.
  • The employer will also have to demonstrate that it is actually achieving its aim; that the discriminatory effect is significantly outweighed by the importance and benefits of the legitimate aim(s); and that there is no reasonable alternative to the action that it is taking. In addition, any justification(s) selected would need to be reviewed on an on-going basis to ensure it remains appropriate. This will be quite a challenge.
  • If an employer opts for an EJRA, HR managers should be mindful that lack of objective justification will expose the employer to possible legal action on the grounds of unfair dismissal and age discrimination.
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