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Is the default retirement age past its sell-by date?

24 June 2010 #Employment


Chancellor, George Osbourne, confirmed in Tuesday`s Budget that the coalition government will start to consult on how to remove the default retirement age (DRA) from April 2011.

Under current law, tens of thousands of workers are forced to retire each year at age 65, causing an estimated loss of £3.5bn in economic output in 2009*. There are calls for the DRA to be scrapped in its entirety in April 2011, rather than phasing it out in stages, as many believe that a phased abolishment would cause more administrative issues for employers than a simple removal.

One of the strongest voices in this area is that of Michelle Mitchell, Charity Director of Age UK (formerly Age Concern), who views the DRA as, "a hugely unpopular law which is well past its sell-by date". Mitchell goes on to state that, "Forcing people in later life out of the labour market when they want to work, save for their pensions and pay taxes is nonsense. It makes a mockery of the government`s plans to help people work longer."

Chris Ball, Chief Executive of The Age and Employment Network, is however concerned that, "older workers need a comprehensive programme of support to help them find and keep jobs. It is about much more than changing the regulations on retirement... Almost one-third of those over-50s in work are employed by the public sector and reports of thousands of imminent job losses make action by the Government all the more urgent. We need to ensure that more older workers are not forced out of the labour market into early retirement and reliance on the state or their savings to get by."

(*www.ageuk.co.uk/latest-news/end-forced-retirement/)

Clarkslegal, specialist Employment lawyers in London, Reading and throughout the Thames Valley.
For further information about this or any other Employment matter please contact Clarkslegal's employment team by email at employmentunit@clarkslegal.com by telephone 020 7539 8000 (London office), 0118 958 5321 (Reading office) or by completing the form on this page.

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