Eversheds research: Employers uncertain over removal of the default retirement age

One in seven employers may retire employees over 65 while they still can under the current regime, according to research from Eversheds.

The research, conducted among 330 employers, found that nearly two thirds (63%) of respondents intend to abandon mandatory retirement after 1 October this year, while only 1% (three respondents) plan to retain a compulsory retirement age.

Around a third said they have not yet decided how to respond.

The research also found that 69% of respondents currently have a policy of mandatory retirement for some or all of their workforce, subject to an employee’s right to ask to stay longer.

Owen Warnock, partner at Eversheds said: “When we conducted a similar survey 18 months ago, the number of employers with a fixed age at which they normally require people to retire stood at 84%.

“This suggests that employers have, unsurprisingly, already started to move away from the idea of forced retirement, a trend that will gather pace over forthcoming months as the number of employers choosing to retain a default retirement age tails off.”

“Nearly a third of those who responded to our study, currently offer insured benefits to those over retirement age.

“It seems that employers are still considering how to respond to the government’s recent announcement of this relaxation: 57% of those who currently provide such benefits said they have still to decide whether to take advantage of the freedom not to do so in future for those at 65 or state pension age. 13% have already decided to take up this option and 15% have decided not to do so.”

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