Question: We have an employee who is 64. About a year or so ago she was talking about retiring. She never gave us a definite date, and since then she seems to have stopped mentioning it. She is in a key role and we want to make succession plans, but we aren’t sure how much we can talk to her about what she wants to do. We know that we can’t force her to retire now that the law has changed – and to be honest, she is still a valued employee and we don’t want her to go, but we realise that she will eventually retire. We just want to try and manage the situation. How much can we talk to her about her retirement plans?
Answer: You are correct that now the default retirement age has been scrapped, it is much more difficult for employers to plan, as there is no longer a definite date when you can assume that an employee will retire. The difficulty stems from the fact that speaking to an employee about their retirement plans could in some cases give that person a potential claim for age discrimination. This is on the basis that by asking the question, you may be inferring that you want them to leave, and you would not be asking the question of a younger employee.
Some people argue that even if this is age discrimination, it is justified (and therefore you would have a defence to a claim) if you have a particularly pressing need to make succession plans. However, this argument hasn’t yet been tested in the courts and is obviously open to interpretation.
One way to overcome the problem, as ACAS recommend in their guidance, is to talk to all of your employees about their future plans and career aspirations regularly, such as at their appraisals. If the conversations are genuinely held with everyone, regardless of age, then it should remove the discrimination argument, and should also give you useful information about your workforce generally too. The ACAS guidance isn’t law, but it is supposed to represent best practice and Employment Tribunals usually do take it into account.
The other thing to remember is that even if your employee tells you that they are thinking of retiring on a particular date, you will not be able to hold them to it unless they have formally given notice, i.e. a resignation. In some ways it is similar now to having discussions with women on maternity leave about their plans to return – there is nothing to stop you asking, but you cannot necessarily rely on what you are told until the employee confirms their plans are definite.
In this particular situation, the employee has already talked to you about retirement in the past, so once you open up discussions with her about her future plans, hopefully this will encourage her to let you know what she is planning to do about retirement. Of course, if she does not want to discuss retirement then it is best not to press the issue, but if she does, then you may then be able to involve her in the succession planning too. Once retirement is being discussed, you could explain that while you realise she is only required to give the notice stated in her contract of employment, it would be really helpful if she could let you know as early as possible once she has decided on a retirement date. In most cases, employees will be more than happy to assist.
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