Compulsory retirement : can I still specify a retirement age?

retireAs there is now no compulsory retirement age, I am reviewing the retirement policy in our handbook.  Currently it refers to “the normal retiring age is 65 years of age”.  Is it OK to leave this in as it stands – it is a simple statement & should be viewed as a suggestion to employees of all ages.  Or would it be better not to refer to retirement all all?

Yes from 1st October 2011, there has been no “normal retirement age” and therefore the statement in your handbook is out of date and potentially misleading. We would strongly suggest that you remove this statement unless you feel you can objectively justify the suggestion that 65 is the “normal” retiring age in your company. It would be better to replace this statement with a general one related to workplace discussions around future aims and aspirations. These of course need to be held with all staff not just older employees. However they do give you a forum where the issue of retirement can be raised in the context of where they see themselves in the next few years. Something like:
“In line with current legislation this company does not have an age where it expects employees to retire. It is however our policy to have regular workplace /appraisal discussions with all our staff where they can discuss performance and any development needs they may have, as well as their future aims and aspirations. Staff and their managers can also use this opportunity to discuss retirement planning should the employee wish to do so.”

You may also wish to consider looking at flexible retirement options for inclusion in your Handbook. This is a scheme that allows employees, with employer’s approval, to achieve a mix of retirement and continuity at work.  The employee reduces their work and gives up part of their salary in exchange for part payment of their pension benefits.

For the employee, the benefits can include an improved work-life balance or freeing up time for caring or other responsibilities without taking the full financial penalty that can come with going part-time or leaving work altogether. For the employer, flexible retirement offers a means of retaining key staff who might otherwise be lost to full retirement and of smoothing transitions to their replacements.


(Article updated April 2018)

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