New Law Allows Employees to Work Until 66, Aligning with State Pension Age
A new law effective Monday allows employees to work until age 66, aligning with State pension eligibility. This change addresses the previous one-year gap between mandatory retirement at 65 and pension access. Employees can now decline early retirement, with employers needing objective justification to enforce it.
New legislation effective Monday allows employees to decline retirement before age 66, aligning with the State pension eligibility. Previously, many employers mandated retirement at 65, leaving a one-year gap before the State pension became available, forcing thousands to claim social protection payments.
The Employment (Contractual Retirement Ages) Bill enables most employees with a contractual retirement age below 66 to inform their employer of their desire to continue working. Employers wishing to enforce earlier retirement must objectively justify it for the specific individual. Employees must notify their employer between three months and one year before their scheduled retirement date. The first beneficiaries of this law will be in September due to the three-month notice period.
This law does not compel anyone to work longer; it grants the right to decline early retirement. Employers can argue for retaining the original contractual age but must provide written justification case-by-case. Approximately 4,500 people annually claim the 65-year-old benefit payment, bridging the gap to the State pension. Many employees, especially in public and Civil Service, already work until 70 since 2018, and statutory retirement ages for gardaí and firefighters (62) remain unchanged.
Ibec reports many employers are adjusting mandatory retirement ages to 66 or revising policies to accommodate employees' right to stay. Those who continue working past 66 will have their cases handled under existing rules, potentially arguing age discrimination or seeking fixed-term contracts.