Mandatory retirement age leads to loss of talent

Almost two-thirds (64%) of employers that operate a mandatory retirement age agree that it can lead to a loss of valuable knowledge and talent, research has revealed.

Among those organisations which had removed the mandatory retirement age, more than three-quarters considered it a positive step, and said it helped maintain valuable skills and their organisation’s reputation.

The research, undertaken jointly by TAEN (The Age and Employment Network) and the Employers Forum on Age, comes a week before the High Court reconsiders the so-called Heyday legal challenge to the UK’s default retirement age of 65.

It also follows a report by the Work and Pensions Select Commons committee which said an employer’s right to compulsorily retire workers when they turn 65, was not in keeping with the government’s aims to raise the retirement age to tackle pension deficits.

TAEN said the survey results undermined the CBI’s argument that there were strong business benefits in having a default retirement age (DRA).

Chris Ball, chief executive of TAEN, said: “The survey shows that the arguments against repeal of the DRA do not correspond with reality. Most employers, even those that have mandatory retirement ages, say it is of no help in dealing with under-performing employees. Yet this was a major reason for the default retirement age when the regulations were introduced.”

Denise Keating, chief executive of the Employers Forum on Age, added: “Many employers, from [small to medium-sized enterprises] to very large and complex organisations, have taken the view that there are no insurmountable barriers to removing retirement ages and are in fact experiencing significant benefits. We have to work with the rest to overcome their fears.”

The survey questioned 198 HR professionals from a range of business sectors.

Personnel Today is supporting a campaign to force the government to scrap the DRA. You can sign our petition on the Number 10 website.

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