Retirement and the Pension Gap*

By January 4, 2022Employment Law

Retirement and the Pension Gap*

One issue which is coming up is the gap between the pension age that a company may want an individual to retire at and when they can obtain the State Pension. Admittedly individuals will be able to obtain Social Welfare in the interim equal to the amount of the pension but at the same time there are also individuals who need to keep working.

The need to keep working arises from the fact of savings having been reduced in value, the requirement to continue the education of children, and, in many cases simply a desire to keep working.

The majority of employers in Ireland continue to look to have a contractual retirement age.

In selecting a retirement age it is important, and this cannot be over stressed, that any organisation putting in a retirement age to consider the needs of the organisation and have the appropriate documentation in place setting out how this retirement age has been selected.

The difficulties in cases where there is a forced retirement is that often this documentation will not be in place and will be attempted to be justified post the retirement.

The Employment Equality Acts set out that an employer must justify the reason for choosing a particular retirement date. There has to be a legitimate aim.

What Retirement Age Will Apply?

The issue of what retirement age will apply in many organisations may not be as simple as a standard retirement age. There are many organisations which will have different categories of employees. Some will have a sedentary job such as an office based job. Others may have a physically demanding role. Therefore in setting a retirement date in many cases it may well be a different date for different groups of workers. This is not of course just simply picking a date. It may well be that appropriate medical advice should be obtained about the setting of a retirement date for different categories of workers and that should then be documented as to why that date has been fixed.

Employers must also be aware of the Code of Practice on Longer Working being Statutory Instrument No. 600/2017. This is a useful guidance for employers and sets out what needs to be done leading up to the retirement age and how to reply to requests from employees to work beyond contractual retirement age. The Code itself specifically sets out that employers need to consider appropriate policy procedures to cater for diverse workplaces and encouraging the retention of older workers and longer working.

*Before acting or refraining from acting on anything in this guide, legal advice should be sought from a solicitor.

*In contentious cases a solicitor may not charge fees or expenses as a proportion or percentage of any award or settlement.

Richard Grogan

Author Richard Grogan

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