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Normal Retirement Age: Employees in Unique Position

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Section 109 of the Employment Rights Act 1996 provides that employees cannot clair dismissal if they are over the 'normal retirement age' (or, if there is no normal retirement age, 65). This section, commonly known as the upper qualifying limit, was upheld as lawful recently in Rutherford v Town Circle (bulletin 2/10/03).

In a majority judgment handed down this morning, Wall v The British Compressed Air Society, the Court of Appeal has held that an employee's contractual retirement age, where he is the only employee in that position, sets up a presumption that that is the 'normal' retirement age.

Previously, the EAT had held that a employee holding a unique position cannot have a 'normal' retirement age, because the requirement for a 'norm' entails the need for a group of people with that retirement age within the company. These cases, Age Concern Scotland v Hines and Dormers Wells Infant School v Wells, have been overturned by the majority of the Court of Appeal.

Giving the leading judgment, Simon Brown LJ (with whom Evans Lombe J., agreed) stated that it was absurd that an individual aged, say, 68, with a contractual retirement age of 70, might claim unfair dismissal if there were two people in his position but was prohibited from claiming unfair dismissal if there was only the one person in his position. Accordingly, the majority held that an employee holding a unique position was not prohibited from establishing a 'normal retirement age'.

Giving a dissenting judgment, Scott Baker LJ held that a unique contractual right of a particular employee to retire on a particular date cannot, by itself, create a 'norm' so as to set a normal retirement age.