Mandatory retirement

Mandatory retirement also known as forced retirement, enforced retirement or compulsory retirement, is the set age at which people who hold certain jobs or offices are required by industry custom or by law to leave their employment, or retire.

Rationale

Typically, mandatory retirement is justified by the argument that certain occupations are either too dangerous (military personnel) or require high levels of physical and mental skill (air traffic controllers, airline pilots). Most rely on the notion that a worker's productivity declines significantly after age 70, and the mandatory retirement is the employer's way to avoid reduced productivity.[1] However, since the age at which retirement is mandated is often somewhat arbitrary and not based upon an actual physical evaluation of an individual person, many view the practice as a form of age discrimination, or ageism.[2]

Economist Edward Lazear has argued that mandatory retirement can be an important tool for employers to construct wage contracts that prevent worker shirking.[1] Employers can tilt the wage profile of a worker so that it is below marginal productivity early on and above marginal productivity toward the end of the employment relationship. In this way, the employer retains extra profits from the worker early on, which he returns in the later period if the worker has not shirked his duties or responsibilities in the first period (assuming a competitive market).

Countries

South Korea

South Korea enforces compulsory retirement before age 60 at the latest to all private companies, and 65 for public sectors. However, it is custom for most companies to lay off their employees between the ages of 50 to 55.

Australia

In Australia, compulsory retirement is generally unlawful throughout the various State and Territory jurisdictions in Australia.[3] Among exceptions to the general rule, permanent members of the Australian Defence Force must retire at the age of 60 and reservists at 65.[4]

Since the passage of a constitutional amendment in 1977, judges on federal courts are required to retire at the age of 70.[4]

Brazil

The Constitution of Brazil says in Article 40, Paragraph 1, Item II, that all public servants in the Union, States, Cities and the Federal District shall mandatorily retire at the age of 70.[5] This regulation encompasses servants from the executive, legislative and judicial branches. It also applies to the Supreme Federal Court Justices, as per Article 93, Item VI, of the Constitution,[5] and the Court of Accounts of the Union Judges, as stated in Article 73, Paragraph 3 of the Constitution (disposition added after the 20th Amendment).[5]

Canada

The normal age for retirement in Canada is 65, but one cannot be forced to retire at that age.[6] Labour laws in the country do not specify a retirement age.[7] Age 65 is when federal Old Age Security pension benefits begin, and most private and public retirement plans have been designed to provide income to the person starting at 65 (an age is needed to select premium payments by contributors to be able to calculate how much money is available to retirees when they leave the program by retiring).[8]

All judges in Canada are subject to mandatory retirement, at 70 or 75 depending on the court.[9] Federal senators cease to hold their seats at 75.

Philippines

Employees working in the government, who can retire as early as age 60, have a set mandatory retirement age of 65.[10] Personnel including officials of the Philippine Armed Forces, the Philippine Coast Guard, the Philippine National Police, the Bureau of Fire Protection, and the Bureau of Jail Management and Penology are required to retire once they reach age 56.[11]

In the private sector, it is illegal to force employees and executives in the private sector to be forced to retire before age 65 with the exception of underground miners who are required to retire at age 60, and professional racehorse jockeys at age 55.[12]

United Kingdom

In October 2006 the Employment Equality (Age) Regulations 2006, the UK Labour Government introduced a Default Retirement Age, whereby employers are able to terminate or deny employment to people over 65 without a reason. A legal challenge to this failed in September 2009, although a review of the legislation was expected in 2010 by the new Conservative/Liberal Democrat coalition government.[13][14] This review has taken place and on 17 February 2011 BIS published the draft Regulations abolishing the Default Retirement Age.[15] Revised regulations were later implemented and, as of 6 April 2011, employers can no longer give employees notice of retirement under Default Retirement Age provisions and will need to objectively justify any compulsory retirement age still in place to avoid age discrimination claims.[16]

United States

Mandatory retirement is generally unlawful in the United States, except in certain industries and occupations that are regulated by law, and are often part of the government (such as military service and federal police agencies, such as the Federal Bureau of Investigation).

From the U.S. Equal Employment Opportunity Commission website:

The Age Discrimination in Employment Act of 1967 (ADEA) protects individuals who are 40 years of age or older from employment discrimination based on age. The ADEA's protections apply to both employees and job applicants. Under the ADEA, it is unlawful to discriminate against a person because of his/her age with respect to any term, condition, or privilege of employment, including hiring, firing, promotion, layoff, compensation, benefits, job assignments, and training.[17]

From the U.S. Code of Federal Regulations discussing the Age Discrimination in Employment Act:

...one of the original purposes of this provision, namely, that the exception does not authorize an employer to require or permit involuntary retirement of an employee within the protected age group on account of age,[18]

...an employer can no longer force retirement or otherwise discriminate on the basis of age against an individual because (s)he is 70 or older.[18]

Professions
  • Pilots: the mandatory retirement age of airline pilots is 65. The Fair Treatment for Experienced Pilots Act (Public Law 110-135) went into effect on December 13, 2007, raising the age to 65 from the previous 60.[19]
  • Air traffic controllers: Mandatory retirement age of 56, with exceptions up to age 61.
  • Federal law enforcement officers, national park rangers and firefighters: Mandatory retirement age of 57, or later if less than 20 years of service.[20]
  • Florida Supreme Court justices: The Florida Constitution establishes mandatory retirement at age 70.
  • Michigan Judges of all levels cannot run for election after passing the age of 70.
  • Minnesota has statutorily established mandatory retirement for all judges at age 70 (more precisely, at the end of the month a judge reaches that age). The Minnesota Legislature has had the constitutional right to set judicial retirement ages since 1956, but did not do so until 1973, setting the age at 70.[21]
  • New Hampshire Constitution - Article 78 sets the retirement of all Judges and sheriffs at age 70.
  • New Jersey Supreme Court also established mandatory retirement at age 70.
  • Maryland Constitution establishes mandatory retirement age of 70 for Circuit and Appellate Court judges.
  • Oregon – mandatory judicial retirement age of 75.
  • United Nations - mandatory retirement age of 65.

Religions

Roman Catholic Church

There is no mandatory retirement age for cardinals nor for the pope, as they hold these positions for life, but cardinals age 80 or over are prohibited from participating in the papal conclave.

Anglican Communion

For the Anglican Communion clergy, they introduced the mandatory retirement age of 65 for priests and 70 for bishops and archbishops, five years younger than their Roman Catholic counterparts, as a result of changes imposed in the Protestant Reformation.

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See also

References
  1. Lazear, Edward P. (December 1979). "Why Is There Mandatory Retirement?" (PDF). Journal of Political Economy. The University of Chicago Press. 87 (6): 1261–1284. doi:10.1086/260835. Archived from the original (PDF) on 24 September 2015. Retrieved 14 October 2012.
  2. Lawrence, Peter A. (2008). "Retiring retirement". Nature. 453 (7195): 588–590. Bibcode:2008Natur.453..588L. doi:10.1038/453588a. PMID 18509422.
  3. "Age discrimination". Australian Human Rights Commission. 18 February 2015. Retrieved 26 April 2020.
  4. Australian Law Reform Commission (2012). "Recruitment and Employment Law". Grey Areas—Age Barriers to Work in Commonwealth Laws (DP 78). Australian Law Reform Commission. Retrieved 31 December 2016.
  5. Constitution of Brazil. (in Portuguese). Retrieved November 24, 2012.
  6. "Mandatory retirement fades in Canada". Canadian Broadcasting Corporation. CBC News. 18 February 2010.
  7. "Mandatory Retirement in Canada". Archived from the original on 23 April 2010.
  8. "Old Age Security payment amounts". Canada.ca. Government of Canada. Retrieved 26 April 2020.
  9. "Supreme Court of Canada - Canadian Judicial System". Scc-csc.gc.ca. 7 April 2012. Archived from the original on 2 April 2010. Retrieved 14 October 2012.
  10. Cervantes, Filane Mikee (15 November 2018). "House panel okays bill lowering retirement age of gov't workers". Philippine News Agency. Retrieved 21 October 2019.
  11. Arguilas, Carolyn (23 January 2018). "Duterte says 56 is "too young" for military, police to retire; DND proposes "up to 65"". MindaNews. Retrieved 21 October 2019.
  12. Jimenez, Josephus (2 July 2018). "Supreme Court: Forced retirement before age 65 illegal". The Freeman. Retrieved 21 October 2019.
  13. "UK retirement age challenge fails". BBC News. 25 September 2009. Retrieved 25 September 2009.
  14. "Q&A: Retirement ruling". BBC News. 25 September 2009. Retrieved 25 September 2009.
  15. "Phasing out the Default Retirement Age: Consultation Document" (PDF). Gov.UK. Department for Business, Innovation and Skills. July 2010. Retrieved 26 April 2020.
  16. "Default Retirement Age to end this year". Gov.UK. Department for Business, Innovation & Skills. 13 January 2011. Retrieved 26 April 2020.
  17. "Facts About Age Discrimination". www.eeoc.gov. Retrieved 17 October 2016.
  18. "US Equal Employment Opportunity Commission". Eeoc.gov. Retrieved 14 October 2012.
  19. "FAA Statement on Pilot Retirement Age" (Press release). 14 December 2007. Retrieved 21 October 2012.
  20. SPECIAL RETIREMENT PROVISIONS FOR LAW ENFORCEMENT OFFICERS, FIREFIGHTERS AND AIR TRAFFIC CONTROLLERS, Defense Civilian Personnel Management Service, January 2011
  21. Stassen-Berger, Rachel E. (7 July 2015). "Minnesota judges aren't making a fuss about retirement rule". Pioneer Press. St. Paul, MN. Retrieved 28 December 2015.

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