Comment: Being forced to retire at 65 is generally age discrimination

Travlaw’s Ami Naru assesses readers’ questions in her latest Legal Q&A

Q

I am considering leaving my current employment, which requires a notice period of 12 weeks due to my length of service. However, also in my contract is a retirement clause which says: “At the end of the month in which you reach your 65th birthday, your contract with the company will expire. Should you wish to continue working, and subject to your managers’ approval, HR will issue a new one-year contract which will then be reviewed at the end of that year.”

I turned 65 on August 2, 2024, so technically speaking I am out of contract. However, my HR department has not contacted me to reaffirm this or discuss options, so I’m assuming they are not aware of this clause. Where do I stand on this with my contract? And, should I decide to retire soon, what notice if any do I need to give them?

A

Firstly, let’s look at the point about the retirement age. Since the repeal of the default retirement age (historically 65) on April 6, 2011, an employer operating with a compulsory retirement age will be at risk of unlawfully discriminating against its employees on grounds of age, unless it can show that compulsory retirement is justified.

In my view it would be hard to justify a retirement age for many employers in the travel industry. A default retirement age is rarely set in contracts of employment these days and retirement policies are the exception rather than the norm.

It could well be that you have a historic contract of employment, which has never been updated.

That said, it would amount to age discrimination for your employer to simply terminate your employment or have your contract expire, just because you reached 65.

Why should you have to ask for your contract to be extended, just because you have reached a certain age? Your employer would have to justify their rationale and explain why this does not amount to age discrimination. The fact HR have not pursued this point, despite it being included in your contract, might imply they are aware of the age discrimination risk.

Given there has been no expiry of your employment when you reached 65, no discussion about extension of your employment, no variation of terms and that you have continued to work, to me your employment is ongoing on your original terms and conditions as set out in your contract.

You would therefore need to give notice in accordance with your contract, as would your employer if they wished to terminate your employment. It is worth noting that notice provisions can be varied by agreement between the parties and at the stage you decide to give notice, you may be able to agree a shorter notice period with your employer.

It is important that employers keep the lines of communication open with older workers about their future plans and have effective procedures in place. This does not mean pushing them towards agreeing a retirement age, as many employees work well past the age of 65; rather, employers should be having discussions about support, wellbeing and any health issues – during which the long-term plans of the employee may naturally evolve.