Susan's Legal Bits

In August 2010 Susan was interested in...

...how the retirement age changes effect umbrella company employees

Hello all,

Another month has passed and despite (or because of) the sunshine causing me all sorts of aches and pains my thoughts have raced towards retirement.....granted I’m still a few years away from it but according to the recent jokes coming my way it looks like by the time I get there the goalposts would have moved again and I might be working well into my seventies!!

This brings me nicely on to the government’s announcement about scrapping the default retirement age as of next October (2011). Of course, even now employees reaching that age have the right to request to continue to work, but employers do still currently have the right to turn down that request and often do exercise that right (Gabem of course never refuses a request from an umbrella employee to continue working).

So, if the default retirement age is scrapped as intended of course there will be no automatic reason for employers to terminate at a certain age and continued employment will depend (as far as I can predict) on capability, conduct and performance (unless of course a redundancy situation occurs). Based on my conversations with Gabem’s umbrella employees of a certain age it is certainly not difficult to ensure high standards of capability, conduct and performance well into one’s seventies and eighties nowadays so it will be a choice for the individual depending on their own personal circumstances.

Of course many of us look forward to retirement and work towards it as an end in sight – and as long as you have made financial provisions for it there is no reason to be despondent about the recent announcement. Of course you can stop working at 65 but I predict it will be a resignation from yourself and it is worth bearing in mind that the state pension is not likely to kick in until you are 66 after 2016 for men.

How does this affect Gabem’s employees? Well, as you are able to continue working past ‘national default retirement age’ already there will be no change apart from in the contractual documentation we send out to our umbrella employees.

You continue to have a choice when to stop working and, until 2016 (for men) and 2020 (for women) the state pension will start paying as of you reaching your 65th birthday (60th birthday for women if born before 1950).

A great tool to use when thinking about your retirement is the direct.gov.uk state pension age calculator. According to mine I have another 31 years, 1 month and 8 days to reach mine – better get back to work then!!!

Have another lovely sunny month all. Act as young as you feel. :)

All comments provided on my blog are for informational purposes only. My thoughts and opinions are my own with agreement from my employer as being suitable for sharing with the wider world. Any advice, or writing that might be taken as advice, should not be deemed in any way as professional Legal advice and are only the musings of a HR practioner whose sole aim is to help where she can.