Celia Powis will be allowed to renew her contract to teach pop mobility - intensive workouts to music - at Worthing Leisure Centre in West Sussex, following a tribunal hearing.
The current law means that the council is legally entitled to force people to retire at or after the age of 65. However, the retiree is entitled to argue their case to stay on.
Powis said: "It's a marvellous result. I'm just going back to normal again, which was all I ever wanted."
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