Age Discrimination - Treatment of Retirement Age

20 December 2004

New legislation will provide for a national default retirement age of 65.

On 14 December 2004, the Secretary of State for Trade and Industry (Patricia Hewitt) announced how the Government will be implementing the age discrimination strand of the European Employment Directive (Council Directive 2000/78/EC) in relation to retirement age.

The legislation, which will come into force in autumn 2006, will provide for a national default retirement age of 65 and a right for employees to request working beyond the set retirement age (but not the right to continue working). The decision to have a national default retirement age will be reviewed after five years.

Employers will continue to be able to set their own retirement age for all or some of their workforce below 65 but only where they can objectively justify this. They would be subject to challenge and would have to show that it was appropriate and necessary to do so.

The default age is not a compulsory retirement age. Employees will be able to work beyond that age wherever they and their employers agree.

The Government has emphasised that it has no plans to change the State Pension Age once it has been equalised for men and women at 65.

The Government will formally review the position again in 2011. If that review suggests that the default retirement age at 65 is no longer required then it would be abolished.