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You are in: Home Page | About Thompsons | Publications | LELR Issue 115
LELR Issue 115 (October 2006)
In the News
Sick Note
Reasonably Adjusted
You're How Old?
Religious Regulation
Caught by COT3
Blow your Whistle
Giving Notice
Now that the age discrimination regulations have come into effect (see LELR 114 for an outline), employees have the right to request to work beyond their retirement date.
Richard Arthur, a solicitor from Thompsons Employment Rights Unit in London, looks at two specific aspects of the regulations –transitional provisions and retirement dismissals.
For people retiring with “expiry dates” on or after 1 April 2007, the standard rules will apply.
The regulations impose two notification duties on employers:
(i) an employer intending to “retire” an employee must notify the employee in writing of the employee’s right to make a request and the date on which they
intend to retire the employee between six months and one year before the intended date of retirement
(the “Paragraph 2 Duty”)
(ii) where an employer fails to comply with their Paragraph 2 Duty, they have a continuing duty to notify the employee as in (i) until the fourteenth day before the operative date of termination (the “Paragraph 4 Duty”).
Details about the employee’s procedure for making a request to stay on, the right to a meeting to discuss the request, the right to be accompanied and the right of appeal can be found in LELR 114.
If the “expiry date” is on or after 1 October 2006, but before 1 April 2007, the regulations set out transitional arrangements which apply in four different circumstances.
If the employer gives notice before 1 October of at least the period required by the contract of employment (or at least four weeks) to expire before 1 April 2007; the employer has made the employee aware before 1 October 2006 that they consider that the employee is being retired on the expiry date; and on or as soon as is practicable after 1 October, the employee notifies the employer in writing of their right to make a request, the employer is treated as complying with their Paragraph 2 Duty.
An employee’s request to stay on, which otherwise complies with the requirements described in LELR 114, will be valid if made:
• where practicable, at least four weeks before the expiry date or
• where this is not practicable, as soon as reasonably practicable (either before or after the expiry date), but not more than four weeks after the expiry date.
If the employer fails to notify the employee on or as soon as reasonably practicable after 1 October of their right to make a request to stay on, the Paragraph 2 Duty does not apply and the Paragraph 4 Duty applies up to the expiry date.
The employee can make a request to stay on either before or after notification.
If the employer gives notice before 1 October which will expire before 1 April 2007, but the period of notice given is less than four weeks (irrespective of what is provided for in the contract: or the employer has not made the employee aware before 1 October that they consider the employee is being retired on the expiry date; and on or as soon as reasonably practicable after 1 October, the employer notifies the employee in writing of their right to make a request, the employer is treated as complying with their Paragraph 2 Duty.
The employee has the right to make a request to stay on. If the employer fails to notify the employee on or as soon as reasonably practicable after 1 October of their right to make a request, the Paragraph 2 Duty does not apply and the Paragraph 4 Duty applies up to the expiry date.
If the employer gives notice on or after 1 October as required by the contract (or statutory, if longer) to expire before 1 April 2007; and before, or the same day as giving notice of dismissal, the employer notifies the employee in writing of their right to make a request, the employer is treated as complying with their Paragraph 2 Duty.
The employee has the right to make a request to stay on. If the employer fails to notify the employee before, or on the same day as, giving notice of dismissal of their right to make a request, the Paragraph 2 Duty does not apply and the Paragraph 4 Duty applies up to the expiry date.
If the employer gives notice on or after1 October which is shorter than the contractual notice (or the statutory notice, if longer) to expire before 1 April 2007, then the Paragraph 2 Duty does not apply and the Paragraph 4 Duty applies up to the expiry date. The employee can make a request to stay on.
The age regulations have also introduced a new potentially fair reason for dismissal - retirement. Although employees over the age of 65 now have the right to claim unfair dismissal, retirement dismissals over age 65 will almost always be fair if the employer complies with their notification obligations.
However, it is clear that some employers have already dismissed older workers before 1 October to prevent the over 65s from acquiring the right to claim unfair dismissal. Unions will need to be astute to identify the real reason for dismissal.
If the reason for the dismissal “could be” retirement, a tribunal will have “particular regard” to the following criteria, to determine if the reason is actually retirement or not:
• whether or not the employer complied with their Paragraph 4 Duty
• if so, when and
• whether or not the employer followed or sought to follow the procedures for holding a meeting to consider a request.
Where the reason (or principal reason) for the dismissal is retirement, the employee is regarded as unfairly dismissed if, and only if, the employer has failed to comply with
• their Paragraph 4 Duty (assuming they didn’t comply with their Paragraph 2 Duty)
• their duties to consider a request and arrange a meeting or
• their duty to consider an appeal.
The Government has announced that it is to delay the implementation of the pensions provisions, apparently to allow more time for employers to “get to grips with them”. These are now expected to be implemented on 1 December, following an additional mini-consultation.
The reason for dismissal can be worked out using the following table (remembering that any retirement age below age 65 needs objective justification):
| Normal Retirement Age (NRA) | Date of Termination | Employer's compliance with notification requirements | Reason for dismissal | |
|---|---|---|---|---|
| 1 | None | Before age 65 | Not retirement | |
| 2 | None | At or after age 65 | Employer complies with Paragraph 2 Duty: contract terminates on "intended date" | Retirement |
| 3 | None | At or after age 65 | Employer complies with Paragraph 2 Duty; contract terminates before “intended date” | Not retirement |
| 4 | None | At or after age 65 | Employer fails to comply with Paragraph 2 Duty; contract terminates before “intended date” | Not retirement |
| 5 | None | At or after age 65 | Any other case where employer fails to comply with Paragraph 2 Duty | Could be retirement |
| 6 | Yes | Before NRA | Not retirement | |
| 7 | 65 or higher | On or after NRA | Employer complies with Paragraph 2 Duty; contract terminates on “intended date” | Retirement |
| 8 | 65 or higher | On or after NRA | Employer complies with Paragraph 2 Duty; contract terminates before “intended date” | Not retirement |
| 9 | 65 or higher | On or after NRA | Employer fails to comply with Paragraph 2 Duty; contract terminates before “intended date” | Not retirement |
| 10 | 65 or higher | On or after NRA | Any other case where employer fails to comply with Paragraph 2 Duty | Could be retirement |
| 11 | Below 65 | On or after NRA | If the retirement age can not be objectively justified, not retirement | If the retirement age can not be objectively justified, not retirement |
| 12 | Below 65 | On or after NRA | Employer complies with Paragraph 2 Duty; contract terminates on “intended date” | If the retirement age can be objectively justified, retirement |
| 13 | Below 65 | On or after NRA | Employer complies with Paragraph 2 Duty; contract terminates before “intended date” | Even if the retirement age can be objectively justified, not retirement |
| 14 | Below 65 | On or after NRA | Any other case where employer fails to comply with Paragraph 2 Duty | Could be retirement |