What are the changes in the law?

It is illegal for employers to discriminate against any employees under the age of 65 on the grounds of their age.

Employers cannot make employees redundant or ban them from training or promotion because they are too old.

Workers are now allowed the right to work beyond the retirement age and when they approach 65, employees will have to be given six months notice by their employer if the company wants them to retire. Employees can request to continue working, but employers can refuse this request without giving a reason in writing.

It is unlawful for employers to specify the age of applicants they would like to employ in job adverts and they are not allowed to include words that may be considered ageist, such as ‘dynamic’ or ‘energetic’.

However, there are ways employers can get out of these laws. If employers can ‘objectively show’ a qualified business reason why they need to discriminate, then they may do so.

The laws also ban retirement ages of below 65 and remove the current age limit for redundancy rights and unfair dismissal.

There are exemptions for the armed forces and businesses who can justify why workers must retire before the age of 65, for example airlines may need an early retirement policy as some countries will not allow pilots aged over 60 to fly into their air space.

Do the laws mean that I can’t retire early?

No, you are still free to retire at any time you choose. If you have a pension which pays benefits at the age of 60, you will still be able to leave your job and live off your pension, if you can afford it.

The laws are mainly trying to stop companies from encouraging older employees from retiring early. If your firm decides to offer older employees early retirement – instead of offering voluntary redundancy to all of their staff – it may be breaking the law.

I’m going to be retiring in the next few years; what about my pension?

Pension schemes have until 1 December to comply with the new rules, but there are concerns that some employees who are due to retire in the next few years may be forced to work until the age of 65. If you are due to retire at 60, for example, you may have to seek permission from your firm and it could affect your pension schemes.

Firms with final salary schemes will have to revise their arrangements concerning early and late retirement, and amendments may be needed to any schemes that let employees join only after a waiting period.

Further Information
Learn your employee rights fast with Lawpack's easy-to-understand guide
Are you an employer? Use Lawpack's 'Employment Contracts Kit' to write your own employee contracts
Read Lawpack's article 'Discrimination at work; what can I do to stop it?'