Compulsory Retirement-Are You Being Forced to Call It a Day?

compulsory-retirement-ireland

Are you being pressurised to retire from your job?

Do you want to continue?

Do you feel as fresh as a spring lamb? (Don’t worry about this one if you don’t).

The good news is that there is no general compulsory retirement age in Ireland, apart from in some fairly limited industries/professions. Therefore, unless it is set out in your contract of employment, or well accepted in your workplace by custom and practice, you cannot be forced to retire, or a claim for a discriminatory dismissal-on the grounds of age-may be open to you.

Employers often confuse the retirement age set down in the company pension as being ‘the retirement age’. But the retirement age for a company pension is a completely separate matter from being forced to retire from employment.

The Employment Equality Acts

The Employment Equality Acts set down 9 grounds on which you cannot be discriminated against, and one of those grounds is age. However, the Acts also provided for certain exceptions and one of these exceptions is that it is not held to be discriminatory per se to set a retirement date for employees.

So, this allows employers to set a retirement age in the workplace, and can rely on a retirement age in the contract-if there is one stipulated. If there isn’t, then the employee may have a good claim for discrimination on the grounds of age.

Nevertheless, employees regularly challenge such dismissals and it is useful to look at how the Equality Tribunal makes its decisions in this type of case.

An EU directive, 2000/78/EC provides that any differences in treatment on the ground of age must be objectively justified and reasonable. This directive is therefore inconsistent with Ireland’s national law-the Employment Equality Acts-when it comes to discrimination on the grounds of age.

The Equality Tribunal has held that this directive has direct effect when it involves a state body as the employer.

The High Court on the other hand has held in Donnellan v Minister for Justice, Equality and Law Reform [2008] that there is no obligation to justify retirement ages under the Employment Equality Acts.

The Equality Tribunal has asked employers to objectively justify the compulsory retirement and show how it is a legitimate aim of the employer, and that the means being used to pursue that aim are proportionate and necessary.

The Labour Court

However, a recent (2013) decision of the Labour Court in Hospira v Roper and Others overturned a decision of the Equality Tribunal and decided that employers are not required to objectively justify age discrimination by way of enforced retirement. The Labour Court recognised that the exception to discrimination provided in section 34 of the Employment Equality Acts was a valid one on the grounds that it was reasonable and objectively justifiable, in the opinion of the legislators who put it on the statute books.

Conclusion

The law concerning compulsory retirement is not entirely clear or consistent with Irish employment equality legislation apparently at odds with an EU directive in this area. Furthermore, the Labour Court and Equality Tribunal appear to take slightly different approaches.

The safest approach from an employer’s perspective is to set out a retirement age in the contract of employment.

If you are an employee and are being forced to retire, you should, at a minimum, seek professional advice before ‘riding off into the sunset’.

Update January, 2016

Section 10 of the Equality (Miscellaneous Provisions) Act 2015 now provides:

Section 34 of the Act of 1998 is amended by the substitution of the following subsection for subsection (4):    
  “(4) Without prejudice to subsection (3), it shall not constitute discrimination on the age ground to fix different ages for the retirement (whether voluntarily or compulsorily) of employees or any class or description of employees if—
  (a) it is objectively and reasonably justified by a legitimate aim, and
  (b) the means of achieving that aim are appropriate and necessary.”.

This is generally done on the grounds of succession planning, that is, so that the employer can introduce new employees to the workforce and offer them promotion prospects etc.

Without the ability to set a retirement age this would be difficult as “new blood” would have restricted opportunities, and arguably the business would suffer.

This means that the employer can impose a retirement age for employees or class or description of employees provided the employer can objectively justify it, and provided the means are appropriate and necessary.

Fixed Term Contracts Post Retirement

Section 4 of the Equality (Miscellaneous Provisions) Act 2015  makes a significant change in respect of fixed term contracts post retirement. You will see below that such contracts can be offered provided

  • they can be objectively justified by a legitimate aim and
  • the means of achieving the legitimate aim are appropriate and necessary.

Clearly, the objective justification for this provision would have to be different from the objective justification forcing retirement at a particular age.

4. Section 6 of the Act of 1998 is amended in subsection (3) by the substitution of the following paragraph for paragraph (c):
“(c) Offering a fixed term contract to a person over the compulsory retirement age for that employment or to a particular class or description of employees in that employment shall not be taken as constituting discrimination on the age ground if—
(i) it is objectively and reasonably justified by a legitimate aim, and
(ii) the means of achieving that aim are appropriate and necessary.”.

Do You Make These Mistakes as an Employer in Ireland?

employers-mistakes

Let’s admit it.

Making a costly mistake is easy when it comes to employment law in Ireland.

The scenarios below are quite common in the Irish workplace. Each of them has the potential to be very costly for the employer if he/she acts on the common misconceptions contained in these hypothetical situations.

My employee is 67 and I want him/her to retire-can I just tell him/her that he/she must retire soon?

No, not unless you have stipulated a retirement age in the contract of employment. There is no general statutory fixed retirement age in Ireland. There is a retirement age set in some public sector jobs and in occupations such as Gardai, the fire service, and the Judiciary.

However in the private sector, if it is not in the contract of employment, the employee can continue working.

I never gave my employee a contract. He has worked with me for 7 years but now I want to give him a contract to reflect the changed economic circumstances.

Firstly, just because you failed to give your employee a written contract does not mean he doesn’t have a contract. He does.

And whatever written contract you propose giving him now must reflect the terms and conditions he has enjoyed to date. Any changes to these terms must be with his consent as not to obtain his consent will amount to a unilateral changing of the contract by you as employer.

This is not permissible and will leave you open to a claim for breach of contract and/or constructive dismissal.

I am not happy with my employee’s performance and I want to replace him with someone who will do the job properly.

You cannot do so without going through a procedure which is fair and allows the employee to improve after you have brought to his attention the failings in his work. This will involve in making clear the standards required of your employee and how he is falling short.

You will need to set out the improvements required and give him a reasonable time period within which to come up to the mark. You will also need to give warnings that failure to improve sufficiently may lead to dismissal (ultimately).

My employee has been out on certified sick leave for ages and I have been told I cannot dismiss her while she is on sick leave so I am stuck with her..

This is not the case-you can fairly dismiss in certain circumstances, even when your employee is out sick. However it will depend on the needs of your workplace, the length of service of your employee, whether the sickness is a long term absence or a series of short term illness related absences.

So, while it is not easy to fairly dismiss while your employee is on sick leave, it is possible.

Always consult a solicitor in relation to cases like those outlined above; each case will be hugely influenced by the particular circumstances and making decisions based on misunderstandings can prove very costly.

Readers’ Questions

Can an employer cut my wages without notice?

No, see this article.

Where do I go if my employment rights have been infringed in Ireland?

There is a wide range of options available if your employment rights have been infringed. Click Here.

Who is not covered by unfair dismissal laws?

Read all about unfair dismissals and constructive dismissals here.

Does NERA tell the employer my complaint if I complain?

Read about NERA inspections here.

I am 66 years old-am I entitled to a redundancy payment?

Yes, the law has changed in this area. Check out redundancy in Ireland here.

Is my employer responsible for preventing sexual harassment in the workplace?

Yes. Read about sexual harassment, equality and discrimination in the workplace here.

Can I bring a case for unfair dismissal if I have less than 1 year’s service?

Yes, take a look at dismissal during the probationary period.

What is direct and indirect discrimination on the grounds of disability?

Take a look at equality and discrimination here.

Are you entitled to a written contract?

Yes, or at least you are entitled to a written statement of the terms and conditions of your employment within 2 months of commencing employment.

What are the important changes in parental leave in Ireland?

Take a look at the new parental leave entitlements in Ireland.

What are employees’ rights when a company is taken over?

This situation is covered by the TUPE (transfer of undertakings) regulations.

Can you take a case for unfair dismissal where dismissed on the grounds of age Ireland?

Yes, and you can take a case for discrimination to the equality tribunal under the Employment Equality Acts.

What is a fixed term teaching contract?

Read more about teachers’ fixed term contracts.

What are workers rights in Ireland regarding dismissal?

Read more about workers rights regarding dismissal in Ireland here.

How to calculate annual leave Ireland

 Learn how to calculate annual leave and pay here.

How many sick days are you entitled to in Ireland?

Learn about sick leave and sick pay here.

How much does it cost to bring a case to the employment appeals tribunal?

This will depend on a number of factors including whether you choose to hire a solicitor or rely on a non-solicitor such as a HR person or not. It will also depend on the strength of your case as some solicitors will take on a good case on a “no win, no fee” basis.

Sample employment contract Ireland

Contact us and we will send you a sample employment contract. Drafting your own contract however, even with the benefit of a template, can be problematic as each employment situation is different and unique.

 Are all workplace policies contractual?

No, it depends on whether the staff handbook/workplace policies have been incorporated into the contract of employment.

In most cases, we do not recommend this for two reasons.

1. If an employer fails to follow a policy/procedure (either deliberately or inadvertently) that would give the employee a claim for breach of contract on top of any other claim he/she might have (e.g. unfair dismissal, discrimination, etc.)

2. As businesses evolve, policies and procedures will need to change – if they form part of the employee’s contract of employment, you would need the consent of all the employees to any such changes. Non-contractual policies and procedures can be varied by the employer without needing to obtain the consent of the staff.

What are the basic principles of fair dismissals?

Procedural fairness and substantial grounds are needed to justify dismissal.

What is the pay for a fixed term specified purpose contract for teaching in Ireland?

 See education law in Ireland website for more information.

What are the grounds that the employment equality act 1998-2011 prohibits not to allow discrimination?

 See the 9 grounds here.

What is the average holiday entitlements per month in ireland?

Discover how to calculate holiday entitlements here.

Can employer take wages for mistakes?

It depends on the contract and whether they are fair and reasonable. See payment of wages..

What is constructive dismissal?

Read what is constructive dismissal.

Employment contract for fixed term teacher

 Employment contract for fixed term teacher

 Can an employer reduce wages?

Yes, but it is not entirely straightforward. Learn more here.

What rights does an employee have if not a trade union member in Ireland?

The employee has full employment, contractual, statutory, and constitutional rights in relation to employment, regardless of whether he is a member of a trade union or not.

What are workers right in Ireland regarding dismissal?

 Learn more about unfair dismissal here.

Calculating annual leave entitlement for part time workers

 Learn how to calculate annual leave here.

Sample grievance procedure Ireland?

 Learn more about grievance procedures here.

How to calculate redundancy pay in Ireland

Calculating redundancy entitlements.

How to deal with workplace discrimination

 Learn more about workplace discrimination here.

Define a health and safety statement in the workplace

 Learn more about health and safety statements here.

Can you take a case for constructive dismissal if you have accepted redundancy?

Generally yes.

Retirement age Ireland

 There is no statutory general retirement age in Ireland. However, some jobs do have a mandatory retirement age eg Garda, civil service. In most private sector employment though the contract of employment must provide for a retirement age if one is required.

How to calculate parental leave

 Learn more about parental leave entitlements here.

Do workers who are paid cash have employment rights in Ireland?

Yes,  they still have a contract of employment (even if not in writing).

Can someone claim unfair dismissal even during probabtion?

Yes, but your options are very limited-you can go to the Labour Court under Industrial Relations legislation but the recommendation is not enforceable. You are depending n the moral authority of the Labour Court and the bona fides of the employer.

 If an employee resigns and cites constructive dismissal does this mean he or she going to take the employer to court?

Almost certainly.

Break entitlements for 8 hours work?

Learn more about working time and rest periods here.

How to calculate holiday pay for piece rate workers Ireland

 Learn about holiday entitlements for piece rate workers here.

How long do you need to be working to claim for unfair dismissal?

 12 months.

When does a contract become a contract of indefinite duration?

 Learn about contracts of indefinite duration here.

What can I do if dismissed on capability grounds?

Bring a claim for unfair dismissal.

Grounds for instant dismissal Ireland

 See basic principles of fair dismissal in Ireland.

Penalties associated with tupe Ireland

See tupe Ireland.

Can i get paid for holidays not taken ireland?

See holiday pay and annual leave.

What  are the duties of the employer regarding workplace safety under the safety and health at work act 2005?

See employers’ health and safety obligations.

Going back to work after maternity leave laws

 Learn more about maternity leave in Ireland.

Reckonable service for part time workers for redundancy ireland

 Read about redundancy in Ireland.

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The answers to most of the questions above can be found on this site-simply use the search box in the right sidebar.

If you need professional advice or assistance in this area, do not hesitate to contact us.

Discover how to reduce the chances of expensive claims by employees.