Definition of Retirement

[Ironballs]

Hello everyone, new member here and I'm hoping someone can help me!

I'm due to attend an Employment tribunal hearing this December and I think it would help my case if I had a legal definition of what "retirement" is. If there is no actual definition, does anyone know of a case that has had to define "retirement"?

Thank you for reading !

Garry

[Celestine]

Really interesting question actually! Found this which may assist? https://www.hr-inform.co.uk/employment_law/retirement

The concept of retirement has changed radically in the last five years, and significant restrictions have been placed on employers’ ability to retire employees since the default retirement age (set at age 65 in 2006) was repealed on 6 October 2011 and phased out.

Employers now cannot require employees to retire, and must allow them to stay on until they choose to retire, unless they can identify legitimate business reasons why a particular retirement age is justified, necessary and appropriate for their organisation, and are able to defend this retirement age in the event of a discrimination claim.

Successive governments have encouraged individuals to continue working (in the light of changing demographics, and the cost of supporting retirees or the “economically inactive”) in the belief that this has positive benefits for older workers and enables employers to retain experienced and skilled staff. KEY POINTS

• There is no longer a state or default retirement age.
• Employers should not pressure employees into resigning because they are approaching a certain age, including those who are at, or over, the state or company pension age.
• Employees should inform their employer of their intention to retire in accordance with the notice provisions in their employment contract.
• Compulsory retirement is only possible where the employer can justify it objectively, based on social policy aims in the public interest which go beyond the business’ own needs, and where forced retirement at a particular age is a proportionate means of achieving them.
• Workplace discussions should take place on a regular basis, to explore older workers’ career plans, to enquire about when they may wish to retire, and to enable the organisation to manage resources and budgets.
• Employers need to avoid making an assumption that an employee's performance may decline as a result of age.
• Employers must avoid discrimination against any workers on the grounds of age.

[Ironballs]

Hi Celestine,

Thanks for the speedy reply, much appreciated. The items you found were things I already knew about. Let me explain the situation I am in and I think you’ll get a better handle why I need an exact definition of retirement.

Last year the company I worked for made 4500 people (voluntary) redundant. The offer to take redundancy was a good one, but if you were 60 or over, you had a second option where you got a payment and if you were in the defined benefit pension scheme, you could take your pension with no actuarial reduction. This second offer was clearly much better. My ex employer could only offer this second option because they added (an unspecified) amount to the pension fund solely for the over 60s. This is where I believe the discrimination is and its my first line of attack in the Employment Tribunal Hearing.

My ex-employer is using The Equality Act (Age Exceptions for Pension Schemes) Order 2010 paragraph 10 (2) (d) as their defence. Para 10 begins

10.—(1) A minimum age for any member of a scheme for payment of or entitlement to a

particular age related benefit on the grounds of redundancy where it is enhanced in accordance with sub-paragraph (2) and paid either with or without consent (whether of an employer, the trustees or managers of the scheme or otherwise).

but paragraph 10 (2)(b) says... by not making any actuarial reduction for early retirement.

I personally do not think redundancy and retirement are the same thing. The definition of redundancy is given at the beginning of the 2010 order, but there is no definition of retirement.

As a fallback I want to say my ex employer cannot use 10(2)(b) as the people were made redundant, not retired. This is why I could use a definition of retirement that is accepted by the courts.

Celestine (any anyone else that wants to chip in) I hope my explanation is clear, just ask me if you need anything clarifying

Thanks again

Garry

[ULA]

The situation with regard to retirement is as Celestine has set out and now most employees have the right to decide at what age they will retire. This means that for most jobs there is no longer a legal set retirement age unless an employer can meet certain legal requirements. This means proving that setting a retirement age is what the law calls 'a proportionate means of achieving a legitimate aim'.

The Equality Act (Age Exceptions for Pension Schemes) Order 2010 provides a definition of "normal retirement age", however this will not give an actual age since, given the above, and if the company had not been able to prove that they could set a retirement date which was 'a proportionate means of achieving a legitimate aim', then a retirement age could not be set and it is down to an individual when to retire.

I am not a pensions expert however my understanding is that for most defined benefit schemes there is a normal retirement age given, however this should be set out in the pension plan. If someone retires before this age then it would reduce proportionally the amount of pension available.

I am a bit confused in terms of the sections you are referring to so therefore can you confirm what you have stated i.e. that your employer is using 10 (2) (d) as their defence. This section states:

(2) The enhancement of any age related benefit payable to or in respect of a member on the grounds of redundancy where the enhancement is calculated in one or more of the following ways—
(d) by not making any actuarial reduction for early retirement.

You then confuse section (2)(b) for (2)(d).

You also say " As a fallback I want to say my ex employer cannot use 10(2)(b)" this section states:

2) The enhancement of any age related benefit payable to or in respect of a member on the grounds of redundancy where the enhancement is calculated in one or more of the following ways—
(b) by reference to a fixed number of years of prospective pensionable service;

Please can you confirm your references otherwise it is hard to follow which argument the company is using and which one you want to use.

However that all aside my view of Section 10 (2)(d) allows for a company, in a situation of redundancy, not to make a reduction in the pension payable if the person being made redundant is below the aged of retirement as defined in the pension plan by the defined proportional amount.

What is it you are actually trying to prove i.e. what is your claim against your former employer. To know this would be very useful, however I guess it is the fact that the company only applied this to affected staff over the age of 60. Again you may need to refer to the terms of the pension scheme.