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CHANGES TO EMPLOYEE RETIREMENT AGES

Changes To The Employee Retirement Age

The age at which an employee may retire is usually stipulated in their employment contract. Factors relating to the employee’s industry and the employer’s policies regulating retirement also play a role. 

The question arises, however: what if an employer changes an employee’s retirement age without the consent of the employee? And, further, could this be an automatically unfair dismissal based on age discrimination? 

In the judgment of BMW South Africa and National Union of Metalworkers of South Africa (2020) 41 (ILJ) 1877 (LAC), the Labour Appeal Court (LAC) decided on these questions.  

In this case, the employee in question, Karl Deppe, had his age of retirement changed from 65 to 60. He had not received the election form to put forward whether he wanted to retire at age 65 or age 60. Deppe, therefore, opposed this as an automatically unfair dismissal on the grounds of his age in forcing him to retire. He believed that he was to retire at age 65 as opposed to the changed 60-year retirement age.  

The LAC confirmed that his dismissal was automatically unfair and was discriminatory based on the employee’s age.  

For that reason, an employer may not unilaterally change an employee’s retirement age. The proper channels will have to be followed to acquire the employee’s consent to a change of their previously agreed retirement age. 

If you have any questions about other Labour or Land issues, contact McCarthy & Associates Attorneys on (033) 266 6170 or  admin@maalaw.co.za. 

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