United Kingdom: Survey Finds Increase in Forced Retirements at Age 65

A survey conducted by DNS/BMRB for Age Concern and Help the Aged suggests that the number of people aged 65-plus forced to retire during 2009 increased to more than 100‚000, a figure four times higher than the number the charity feared would be hit when the Default Retirement Age was introduced in 2006. According to the poll of people aged 60 to 70, 24% knew a friend or colleague who had been made to retire at or after 65.

Michelle Mitchell, a director at Age Concern and Help the Aged, said: “Our survey clearly shows the use of forced retirement has spiralled out of control, offering some employers a low-cost shortcut to shed jobs during the recession."

Source: AgeUK News Release (February 25, 2010)

Cambodia: Enforcing Mandatory Retirement to Open Up Jobs for Younger Workers

According to an article in the Phnom Penh Post by Kay Kimsong, Hun Sen issued a directive on January 12 calling for the retirement of all male officials over the age of 60 and all female officials over the age of 55, in accordance with laws that have been on the books in some form since 1994. According to supporters, enforcement of the mandatory retirement rules will lead to new ideas and reduce civil servant corruption.

Thus, for example, Rong Chhun, president of the Cambodian Independent Teachers Association, said more opportunities for corruption materialise the longer employees stay in the same job. Sieng Rithy, chief of the education and advocacy unit for the Khmer Youth Association, said enforcement of the directive would enable a new generation of employees to shape policies.

Source: The Phnom Penh Post "Young workers stand to gain from rule on retirement age" (February 3, 2009)

Advocate General Opinion Supports U.K.'s Mandatory Retirement Law at European Court of Justice

Jan Marzak, the Advocate-General for the European Court of Justice, has issued an opinion recommending that the Court uphold the United Kingdom's law taht bans discrimination on the ground of age but excludes pensioners, who can be dismissed at 65 without redundancy payments, or at the employer's mandatory retirement age if it is above 65. According to Marzak:

A rule such as that at issue in the main proceedings, which permits employers to dismiss employees aged 65 or over if the reason for dismissal is retirement, can in principle be justified under Article 6(1) of Directive 2000/78 if that rule is objectively and reasonably justified in the context of national law by a legitimate aim relating to employment policy and the labour market and it is not apparent that the means put in place to achieve that aim of public interest are inappropriate and unnecessary for the purpose.

According to Gordon Lishman, director general of Age Concern, one of whose member organizations--Heyday--brought the case to set aside the law, "This is a set back, but it is not a disaster." While Age Concern would have preferred to have the Advocate General’s support, his "opinion confirms that the EU Directive requires age discrimination to be justified. It’s now up to the UK government to prove to the High Court that their social and employment policies are important enough to justify kicking people out of work at 65."

Sources: The Times "Setback in battle against compulsory retirement age" (September 24, 2008); Personnel Today "Heyday age discrimination ruling: what the employment lawyers and experts say" (September 23, 2008); Age Concern Press Release (September 23, 2008); Employers Forum on Age Press Release (September 23, 2008)

United Kingdom: DWP Study Shows Retirees ' Unease at Retirement

The Department for Work and Pensions (DWP) reports that less than half of Britons chose the word “happy” to describe how they felt on the first day of retirement: "evidence the traditional sudden stop approach no longer works for many people." According to the research conducted by Ipsos MORI, while 48% were happy and 31% relaxed, almost one in ten reported being sad (11%), anxious (8%), or lost (8%).

Pensions Minister Mike O’Brien commented:

The idea that one day you work and the next you stop can be a shock to the system. These findings challenge the traditional "one size fits all" approach to retirement. Many of today’s older workers are rejecting the cliff edge between work and retirement in favour of a gradual step down. And employers should help them to do this.

Gordon Lishman, Director General of Age Concern, responded in decrying the "ultimate 'cliff edge'" of the mandatory retirement age of 65 and said The "government must abolish this discriminatory barrier if it is serious in wanting to help older people to continue working." Charles Cotton, Reward Adviser at the CIPD, was reported as responding: "Both our own research and the report published today from the DWP show that people are increasingly eager to work past the default retirement age, for social, personal as well as financial reasons."

Sources: Department for Work and Pensions Press Release (April 8, 2008); Fair Investment Company "Pension and other worries tarnish retirement" (April 8, 2008); Age Concern Response (April 8, 2008); TrainingZone.com "New research strengthens case for older workers" (April 8, 2008)

Law Firms Confront Aging Workorce in Their Own Profession

Elizabeth Goldberg writes in American Lawyser that as baby boomers hit their 60s, U.S. law firms are trying to keep the most experienced and talented ones from walking out the door. She tells older lawyers that are healthy and productive and eager to keep working, that law firms want them and are willing to help out with work/life balance, setting one's own schedule, and getting flexibility. She cites one study showing that boomers now constitute 70% of law firm partners. "Boomers will not only challenge traditional notions of when partners retire, but also how they do so."

Already, retirement age is a hot topic in law firms, especially as mandatory retirement policies have increasingly come under attack. In January the New York State Bar Association issued a report opposing mandatory retirement on the grounds that it is archaic and unfair. In August the American Bar Association adopted the New York Bar report and recommended that all firms end forced retirement. And in October, Sidley Austin settled a long-standing age discrimination case with the Equal Employment Opportunity Commission that included a promise to revoke the firm's mandatory retirement policy.

According to an American Lawyer survey of the top 200 firms, in 69% of them, 20-39% of the equity partners are age 50 or older, and at 23% of firms, more than 40% of the partnership is 50 or older. Furthermore, 64% of the firmsd have a mandatory retirement age, ranging mostly from 65 to 70.

Source: American Lawyer "Law Firms Face Gray Area as Boomers Age" (December 10, 2007)

United Kingdom: European Court Decision Seen as Supporting Mandatory Retirement Law

A number of United Kingdom lawyers, reacting to the European Court of Justice decision upholding Spain's manatatory retirement law, believe the decision suggests that a challenge to the UK law will also fail. Thus, for example, a story in Personnel Today quotes Rachel Dineley, employment partner at law firm Beachcroft, as saying:

"While Heyday may persist with its challenge regardless of this development, employers can take comfort from what is clearly a sound and sensible view.

"Conversely, employees who had contemplated challenging their employer's decision to require them to retire on reaching age 65 may reluctantly accept the decision, and recognise that any challenge through the Employment Tribunal is very probably futile."

Similarly, in an article for THe Times, Michael Herman quotes James Baker, a solicitor at Macfarlanes, as saying: “The court has clearly accepted that mandatory retirement ages are discriminatory but that they can be justified as in this case.”

However, in a story in Clickdocs, quotes Juliet Carp, an employment solicitor with Speechly Bircham LLP, as saying:

"At first sight, the ECJ's decision seems likely to disappoint older workers - and delight many employers.

"Although the judges in Palacios made it clear that a wide discretion is offered to member states, it is still possible that the ECJ might not accept the British policy objectives as a legitimate excuse for age discrimination."

In addition, Gordon Lishman, Director General at Age Concern, has announced that, while disappointed that the the Palacios case did not succeed, Age Concern still believes "it is discriminatory for an individual to be made to retire on the grounds of their age and against their will," and that the Court decision will not set back the legal case that Heyday, supported by Age Concern, is bringing to the Court. "There are significant distinctions between the Heyday case and the case of Felix Palacios. The legal advice we are hearing is that Heyday should forge ahead with its case undeterred."

Sources: Personnel Today "European Court of Justice signals UK's mandatory retirement age will survive Heyday challenge" (October 16, 2007); The Times "EU ruling a blow to workers over 65" (October 17, 2007); Clickdocs "Compulsory retirement not prohibited, says ECJ" (October 18, 2007); Age Concern News Release (October 17, 2007)

European Court of Justice Upholds Mandatory Retirement Legislation

In the case of Palacios v Cortefiel Servicios SA, the European Court of Justice has held that the European Union's Equal Treatment Framework Directive does not prohibit member states from introducing mandatory retirement ages. Following an earlier ruling by an Advocate-General of the ECJ, the Court ruled on a complaint brought by Félix Palacios de la Villa against Cortefiel Servicios SA, in which Mr Palacios claims that his dismissal on the ground that he had attained the compulsory retirement age laid down in a collective agreement was unlawful and that a provision in Spain's discrimination laws which effectively allowed employers to force staff to retire at 65 was incompatible with European law.

In its decision, the Court first stated that national legislation fixing an age for compulsory retirement establishes rules relating to "employment and working conditions, including dismissals and pay" within the meaning of Council Directive 2000/78/EC of 27 November 2000--establishing a general framework for equal treatment in employment and occupation--and, therefore falls within its scope. Thus, since such legislation directly imposes less favorable treatment for workers who have reached that age as compared with all other persons in the labor force, it cannot pass muster unless there is justification for that difference in treatment.

Turning to the justification in the case of the Spanish legislation, the Court found that it lay in a national policy aiming to promote better access to employment by means of better distribution of work between the generations, even though the legislation did not formally refer to that aim. Furthermore, the court found that the legitimacy of such an aim could not reasonably be called into question, since the promotion of a high level of employment constitutes one of the ends pursued both by the European Union and the European Community.

The Court stopped short of authorizing any such legislation. While member states and enjoy broad discretion in their choice, the national measures may not go beyond what is "appropriate and necessary" to achieve the aim concerned. Thus, the Court found it not unreasonable for a member state to take the view that compulsory retirement, because the worker has reached the age-limit provided for, may be appropriate and necessary in order to achieve a legitimate aim in the context of national employment policy consisting in promoting full employment by facilitating access to the labour market. Furthermore, the Spanish legislation was not based only on a specific age, but also took account of the fact that the persons concerned were entitled to financial compensation by way of a retirement pension at the end of their working life, the level of which cannot be regarded as unreasonable.

Source: European Court of Justice News Release (October 16, 2007)

Ireland: Report Calls for Abolition of Mandatory Retirement

A call for an end to mandatory retirement was one of the key recommendations of the Senior Select Retain & Retrain partnership as part of its final report--"More than just a Number, Older workers in Ireland." “The impact which compulsory retirement has on people cannot be underestimated,” Age Action chief executive Robin Webster said that “[c]ompulsory retirement ages, whether in the public service or not, should be removed. It would not only give workers who wish to continue working the option to do so, but would also enable employers retain some of their most experienced and valuable staff.”

The partnership consists of Age Action, FAS, ICTU, PARTAS and Contact Recruitment, and was funded by the EU Equal Community Initiative. Other recommendations of the final report include:

• Those who are made redundant or leave the workforce should be provided with the information they need to help them make this transition;
• In facilitating diversity in the workplace, it is essential that in-company age awareness training become a routine part of good HR practice, also leading to an improvement in inter-generational communications within companies;
• Older workers need to be assisted in knowing how to sell their experiences and validate their competencies, regardless of formal qualifications;
• employers need to examine work practices and make flexible work arrangements available, inclduing part-time work;
• older workers should benefit equally from access to training and courses should be more geared towards their personal and professional development;
• there is a need for a one-stop shop for employment services for older people.

According to the Minister of Enterprise, Trade & Employment, the recommendations bear serious consideration by policy-makers, practitioners and decision-makers: "Dissemination of the findings of the project’s work and of the lessons learned will be invaluable both in the policy making process and in generating public awareness generally of the issues involved."

Sources: Age Action Ireland "Time has come to abolish the mandatory retirement age" (October 4, 2007); The Irish Times "Call for end to mandatory retirement age" (October 4, 2007); Department of Enterprise, Trade and Employment Address by Minister Michael Martin at the “Experience has a Future” Conference (October 4, 2007)

Additional Resources: Senior Select Retain and Retrain "Older Workers & Employment Agencies in Ireland" (September 2007)

United Kingdom: Extensive Research Study Highlights Employers' Approach to Older Workers

A qualitative study looking at how United Kingdom employers are responding to an ageing workforce carried out by the Centre for Research into the Older Workforce (CROW) and published by the Department of Work and Pensions suggests that most employers say they have positive attitudes to older workers, although they are more reluctant to recruit the over-50s and training seems to tail off for this group. Many employers claim to prefer older workers to younger ones, because of their attitudes to work and their experience. Small firms were particularly likely to keep older people on after State Pension Age.

The study--"Employer Responses to an Ageing Workforce"--was authored by Professor Stephen McNair, Director of CROW, Matt Flynn and Nina Dutton and is based on in-depth interviews with either a senior human resource (HR) manager or a general manager at one of 70 firms, across nine occupational sectors, with a wide geographical spread. According to the summary introduction to this 188-page report:

This study has found that awareness of the Age Regulations is high among employers and that, in general, most are sympathetic to avoiding age discrimination in the workplace, although many do not make the connection between this and business needs, partly perhaps because they are unaware of long term demographic trends. Attitudes towards 'older' workers were generally positive, while young people were viewed more negatively and rarely seen as victims of age discrimination. There was a good deal of change in HR practices generally, but rarely as a sole result of the Regulations. Positive practices on retention of existing workers were much more common than active policies on recruitment. Employers were most likely to be anxious about the implementation of the new provisions on retirement, and the management challenges which this might present. In this area defensive responses appeared sometimes to be having the opposite effect to that intended by Government. The attempt to minimise risk and workloads for managers was a common theme. Within the limitations of the sample interviewed, there was no evidence of regional variation in employer behaviour.

Source: Department for Work and Pensions Research Report No 455--"Employer responses to an ageing workforce: a qualitative study" (September 27, 2007)

Armenia: Dismissal of Older Lab Workers Raises Concerns

Yerevan State University's decision to dismiss 65 laboratory workers age 65 or older who had spent years as assistants in the university’s chemistry, biology, and physics labs has raised concerns, according to an article by Sara Khojoyan. While national labor law is on the university rector’s side, since an employer has the right to cancel contracts with workers based on the national retirement age--61 for women and 65 for men, the University trade union president suggests that the workers, who are protesting their dismissal, are raising moral issues that the law does not address.

Source: Transitions Online "Out With the Old" (August 6, 2007)

India: Older Workers Beng Ignored in Economic Boon? A Commentary

Ravi Srinivasan, writing in the Hindustan Times, suggests that "India’s absurdly low retirement age of 58" means that by 2010, one-fifth of India’s current workforce ("from shop-floor workers to top managers") will be out of the workforce. Even though India has had a demographic drawing card--its vast supply of young workers entering the workforce, Srinivasan reports on recent surveys that show that several industries in India are already facing moderate to severe talent shortage.

“Opening the doors to older workers is a major benefit…it will help organisations retain knowledge and experience, widen the recruitment base and could lead to more customers and greater profits,” commented Soumen Basu, executive chairman, Manpower India.

Thus, "looking beyond those grey hairs makes sound business sense." Otherwise, in a few years, India may have found itself "untutored and fertile" over "educated and aging."

Source: Hindustan Times "India’s overlooked ‘grey market’ workforce" (July 12, 2007)

Expert Knowledge May Offset the Impact of Old Age in Some Occupations

According to a study published in the February 27, 2007, issue of Neurology®, older pilots performed better over time than younger pilots on flight simulator tests. The results of a three-year longitudinal study by Joy L. Taylor, PhD, Quinn Kennedy, PhD, Art Noda, MS and Jerome A. Yesavage, MD were published in "Pilot age and expertise predict flight simulator performance". Among other things, the authors found that "while older pilots initially performed worse than younger pilots, older pilots showed less of a decline in overall flight summary scores than younger pilots, and over time their traffic avoidance performances improved more than that of younger pilots."

“These findings show the advantageous effect of prior experience and specialized expertise on older adults’ skilled cognitive performances,” said study author Joy L. Taylor, PhD, with the Stanford/VA Aging Clinical Research Center in Palo Alto, California. “Our discovery has broader implications beyond aviation to the general issue of aging in the workplace and the objective assessment of competency in older workers.”

In the same issue, Joseph I. Sirven and Daniel G. Morrow have an editorial--"Fly the graying skies: A question of competency vs age" suggesting that the study had implications "well beyond aviation," noting the rapid aging of the population means increasing numbers of older workers in critical occupations. As quoted in The San Francisco Chronicle:

"It is time to reconsider fixed age limits for the workplace and consider transitioning to competency-based evaluations of performance," said the editorial authors, Dr. Joseph L. Sirven of the Mayo Clinic and Daniel G. Morrow of the University of Illinois at Champaign-Urbana. "Better simulation techniques need to be developed not only in aviation, but also in medicine and other careers where public safety is at risk.

Source: American Academy of Neurology Press Release (February 26, 2007)

Other Sources: The San Francisco Chronicle "Experience tops youth in study on aging pilots" (February 27, 2007); HealthCentral.com "Pilot Study Questions Wisdom of Mandatory Retirement" (February 28, 2007)

European Court Upholds Collectively-Bargained Mandatory Retirement Age

Jan Mazak, an Advocate-General of the European Court of Justice, has rendered an opinion that European law allows individual countries to pass legislation permitting mandatory retirement ages. Thus, a provision in the Spain's discrimination laws that effectively allows employers to force staff to retire at 65 is compatible with European law.

The dispute was brought by Félix Palacios de la Villa against Cortefiel Servicios SA, in which Mr Palacios claims that his dismissal on the ground that he had attained the compulsory retirement age laid down in a collective agreement was unlawful. However, the Advocae-General ruled that the European principle of non-discrimination on grounds of age does not preclude a national law pursuant to which compulsory retirement clauses contained in collective agreements are lawful, where such clauses provide as sole requirements that workers must have reached normal retirement age and must have fulfilled the conditions set out in the social security legislation of the Member State concerned for entitlement to draw a retirement pension under the relevant contribution regime.

This decision particulary attracted attention in the United Kingdom.

Although [the] case concerns collective employment agreements, which are much less common in the UK than elsewhere in Europe, lawyers said that the legal opinion also applies to individual contracts and so the case is directly relevant to British workers.

James Baker, an employment lawyer at Macfarlanes, said: “This opinion will disappoint thousands of workers in the UK who are pinning their hopes on a legal challenge to the mandatory retirement age.

Source: European Court of Justice Opinion of Advocate General C-411/05 Palacios de la Villa (February 15, 2007)

Other References: The Times of London "Blow for workers as European court says mandatory retirement is lawful" (February 15, 2007)

FAA Contemplates Raising Mandatory Retirement Age for Pilots, Wall St. Journal Reports

According to an article by Andy Pasztor for the Wall St. Journal, the Federal Aviation Administration, moving away from its longstanding policy that airline pilots must retire at age 60, wants to let them work in the cockpit as many as five years longer. Pasztor reports that after repeatedly opposing similar efforts to change the rules, some U.S. airlines and pilots groups are beginning to soften their stances.

The FAA's apparent change of heart is influenced by the current tight market globally for pilots as well as the lack of recent scientific data demonstrating any clear-cut erosion of safety from extending the careers of pilots, according to one person familiar with the matter. In addition, the Equal Employment Opportunity Commission concluded the 60-year age limit is discriminatory.

In addition, Pasztor writes that keeping the age limit at 60 is becoming more difficult to defend, following a move by the International Civil Aviation Organization to raise retirement ages at airlines world-wide. A spokeswoman for FAA Administrator Marion Blakey said the industry can "expect a decision relatively soon." However, if a proposal is made, finalizing new regulations could take 18 months or more.

Source: Wall St. Journal "FAA Set to Raise Retirement Age For Pilots to 65" (December 11, 2006 (subscription required)

Canada: Ontario's Ban on Mandatory Retirement Begins December 12, 2006

Ontario's "Ending Mandatory Retirement Statute Law Amendment Act, 2005", which was enacted by the legislative assembly in December 2005, takes effect on December 12, 2006. When the legislation takes effect, it will amend the Ontario Human Rights Code to protect people aged 65 and over from age discrimination for most employment purposes.

The Ministry of Labour has updated its FAQ: Mandatory Retirement and also maintains a Mandatory Retirement website.

Source: Ontario Ministry of Labour News Release (November 14, 2006)

Other Sources: Hamilton Spectator "Mandatory retirement soon to be obsolete" (November 28, 2006)