CIPD pushes government to scrap mandatory retirement age after todayís ECJ statement

The days of the default retirement age are numbered in spite of the European Court of Justiceís statement on the Heydey case, according to the Chartered Institute of Personnel and Development (CIPD). In todayís tough economic climate, this ruling could spell bad news for employees currently approaching retirement.

CIPD research, Future Demand for Working Among Older Workers, highlights Heydayís concern that employees who wish to work past the state retirement age - for both personal and financial reasons - are being prevented from doing so. The research found that just under two fifths (38%) of individuals plan to carry on working beyond 65. Interestingly, among those who said they did not plan to work past sixty-five, 31% would change their mind if their employer allowed them to work flexibly; highlighting the unsuitability of a one-size fits all default retirement age. Currently, only 11% of the workforce work beyond State Pension age.

Dianah Worman, Diversity Adviser at the CIPD says: ìThe default retirement age should be scrapped. It leads to lazy management, not just of people at the retirement age, but of those approaching it.

ìWhether or not todayís statement from the advocate general still stands at the final ECJ ruling, we believe the days of the default retirement age are numbered. Employers who continue to engage, develop and motivate their older employees, rather than allowing them to coast towards an inevitable, mandatory retirement age, reap the benefits. Many organisations, like Nationwide and the Department for Work and Pensions – have already abandoned mandatory retirement and have begun to reap the benefits. Older workers have experience, talent and commitment to offer if they are treated well by their employers. The wider economy also benefits from the continued employment of this pool of talented and willing workers.

ìOur research shows that many older workers want to keep working beyond the mandatory retirement age, for a mixture of financial reasons, and a desire to continue contributing and doing what theyíve always done. People shouldnít be forced to work until they drop. But neither should they be compelled to stop work when they still have a valuable and willing contribution to make.

ìThe enforcement of the default retirement age is likely to increase as the credit crunch bites. Last weekís ONS figures showed that middle-aged people and those up to state pension age appear to have borne the brunt of the fall in employment. In light of this, those approaching retirement may fear that they will be forced to retire as organisations look for an easier way to reduce head count.î