A review of the default retirement age is to be brought forward by a year, the government has announced.
The review had been expected to take place in 2011, but will now take place next year in response to changing demographic and economic circumstances, ministers said.
Denise Keating, chief executive of leading age campaigners the Employers Forum on Age, said: "We are absolutely delighted that the government has finally listened to reason and taken action to tackle an archaic system which allows the enforced retirement of people simply because of their age.
"In an ageing society and as recession begins to bite, we can no longer afford a culture of early retirement", she added. "It is vital that this anomaly in the age discrimination legislation is removed as it will help deliver the massive cultural shift which is needed to stop people being stereotyped by age."
At the moment, most workers decide to retire before the age of 65, but there are still 1.3 million people who do work beyond state pension age, with many more employees saying they would too, if their employer allowed it.
Dianah Worman, diversity adviser at the Chartered Institute of Personnel and Development, said the decision comes in the "nick of time".
"The economic situation and panic about pension income means maintaining the default retirement age is unsustainable. We never supported its inclusion in the Employment Equality (Age) Regulations 2006 because strong demographic evidence made it nonsense.
"In these tough times, the government has no choice but to bring this review forward to help organisations make better use of the talent, skills and knowledge of experienced older employees, but also to help supplement their diminishing pensions."
However, Matthew Lawrence, a senior consultant at Aon Consulting, questioned whether this review is really needed by employers and employees at all.
"The evidence shows that businesses are already adopting a pragmatic approach to retirement and they do not use 65 as an arbitrary way of retiring people," he said.
"Workers over the age of 65 can bring a significant benefit to the workplace but having a default retirement age has the advantage of giving employers a clear framework around which to make long-term plans for their workforce."
2 Responses
Retirement Age
If the government decides to let people retire later they should also allow them to retire earlier. Surely, it depends on how long you have been workining. I left schoold at 15 and have been working with no break since then. I am looking forward to retiring when I am Sixty.
Also, if people work longer won’t there be a shortage of jobs for young people?
Retirement Age
Contrary to the received HR wisdom, I think that there should be a default retirement age. Nothing stops organisations being pragmatic and letting those who are able to work longer to do so. However, a retirement age gives the employer and the employee a formal chance to review what is in the best interests of both parties.
There are some older workers who have given many years of loyal and excellent service to an organisation, but who, as they get older, are less able to do their role. Having to dismiss such an employee due to capability would be unpalatable for the employer and potentially devastating for the employee whereas letting them retire gracefully is best all round.
Those trying to uphold the rights of older workers also ought to take into account that many employers at the moment allow older workers a couple of years before retirement to wind down; they give those workers the benefit of the doubt, knowing that they will be retiring soon. With the removal of a retirement age, employers are likely to take action sooner to terminate an older worker’s employment.