Do not assume employees will retire!
Four years ago I published an article about a client company that made a very costly mistake when it assumed that one of its employees would be retiring and had made arrangements to recruit and train a replacement – without actually having received a letter of resignation from the employee. He (quite rightly) complained that he was being constructively dismissed. He had long service with the employer and it cost them a lot to settle the dispute.
Unfortunately it seems that companies are still making the same mistake. Just recently a company accountant received £182,000 for age discrimination after being pushed out of his job. In this particular case John Peters successfully argued in a Liverpool tribunal that his former employer, Rock Oil, had unfairly dismissed and discriminated against him in a bid to get him to retire. He was aged 67 at that time.
The Warrington-based lubricant company alleged it finally dismissed Peters, on conduct issues. However, Peters, claimed his former employer pushed him out because they wanted him to retire at 65 and had even gone as far as to recruit his replacement in anticipation of this. They were so aggressive and threatening in their approach that he ended up on a period of sick leave for work-related stress. The Company’s poor treatment of him led to the Tribunal increasing the award made against it.
It is important to remember that unless there is a genuine occupational reason for compulsory retirement at a particular age (and there are very, very few of these) you would need a genuine reason for dismissal e.g. conduct, capability or redundancy to avoid a substantial award of compensation to be made by a tribunal. Any dismissal must not be disguised as being for a different reasons or it could be judged to be unfair.
If you have questions about succession planning or would like to find out how to tackle discussions about retirement to ensure they are not likely to be considered to be discriminatory, please get in touch.
Posted on 08 May 2017