Cambridge University sets employer justified default retirement age
This article features on the recent case of Seldon v Clarkson, Wright and Jakes in which it was decided that an employer set retirement age can be legitimate. It appears that Cambridge University has reacted to the decision in Seldon and have become one of the first employers to set a default retirement age despite the dangers associated with indirect discrimination.
In order to convince themselves that their default retirement age would stand up to scrutiny to ensure that it is a proportionate means of achieving a legitimate aim, the University set up a focus group that consulted very carefully in respect of not only choosing a retirement age but also setting out the reasons for and the legitimate aims as to why they found it necessary to retire people at this age.
Cambridge University’s focus group came up with the following reasons:
• Intergenerational fairness – this was considered the strongest argument for a default retirement age as, just as in Seldon, Cambridge thought it important that employees must be able to progress through the promotional stages in order to further their careers. It was also noted that this would create a balance of age groups throughout the University.
• Progression of Academy – it was also considered vital that people are retired and new people brought in with new innovative ideas to ensure the continued promotion of education.
• Preservation of academic autonomy and freedom – the focus group considered that academics and senior administrators are given employment security to perform their research without fear of negative action and a default retirement age is considered a necessary counter balance to the enhanced security that the University provides.
• Equality and Diversity – it was considered that having a default retirement age would allow the University to meet public duty and address its race and gender imbalance at certain levels.
The focus group at the University also considered it important to provide facts as to why it decided that 67 was an appropriate retirement age. They produced the following:
• More than 64% of new academic opportunities created are directly due to retirement.
• At least 65.6% of retirees among academic staff retired at the current retirement age of 67 or later and
• The average length of service of academics is 14.2 years.
In addition to setting a default retirement age, the University also provided that should an employee not wish to retire at 67 they can apply to work for a maximum of a further 3 years.
The actions taken by Cambridge University will be interesting to employers right across the United Kingdom. According to a recent survey, 1 out of 157 organisations participating in the research say they do not have an employer justified retirement age due to the uncertainties but many would like to if the law was more settled. You should note that while the Seldon case decided that the aim was legitimate it is still to be decided whether the retirement age of 65 was a proportionate means of achieving those legitimate aims and as such the question still remains open.
About the author
Joanne Stronach is joint Head of Burnetts' Employment Law & HR team.