Mandatory retirement is far from mandatory in B.C

Sixty-five has long been regarded as retirement age in Canada.

The federal government originally established it as the age for Canada Pension Plan eligibility. That threshold has since been reduced to 60, albeit not at full pension. Many collective agreements set the age of retirement at 65, as do numerous private pension plans.

The public sector and other large employers have mandatory retirement provisions that set the age of 65 as the age of retirement. Such mandatory retirement provisions have been challenged in the courts and, in general, have been upheld by the courts under specific circumstances.

Statistics show that employees typically retire in the 60 to 65 age bracket. Thus, the suggestion, or in some cases the apparent requirement, that retirement is appropriate at age 65 seems to be working, according to the statistics.

The notion of retirement by age 65 has gained a strong foothold in our collective awareness.

But self-employed and professional people generally tend to retire after age 65. Statistics show that seven percent of workers retire past the age of 70.

This begs the question: is there such a thing as mandatory retirement at age 65?

With the first wave of baby boomers approaching 65, the question is gaining in importance.

The full answer to the question is complicated.

However, there are some simple principles that can provide a general understanding of the issue:

In common law, there is no mandatory retirement age and neither is it recognized as a basis for terminating employment.

Retirement falls within employment, which is generally regulated by contract law principles. Mandatory retirement consequently turns on the terms of an employment contract.

Each employment contract stands on its own terms and must be analyzed according to its own facts.

Without an expressed term or condition of employment or implied agreement that requires mandatory retirement, age alone is not a basis for terminating employment.

Age alone does not constitute proof that an employee is unemployable; an employee is therefore entitled to sufficient notice in the event of dismissal without cause, regardless of age.

Mandatory retirement can be a form of constructive dismissal.

Issues outside the black and white constraints of a hiring letter or employment contract can be included in the terms of employment.

For instance, if the employer has instituted a clearly defined mandatory retirement policy and if that policy forms part of the employment contract, the contract can be amended to allow the employer to enforce mandatory retirement.

Also, if an employer has consistently followed a mandatory retirement policy that is known to the employee, the employer may be able to enforce mandatory retirement on the basis that its past conduct forms part of the terms of employment.

In addition, if an employee has agreed with a retirement date, even though there is no written term relating to retirement, the terms of the employment agreement may allow the employer to enforce the retirement.

In B.C., the Human Rights Code recognizes mandatory retirement plans that become effective when employees reach 65.

But unless your employment contract states otherwise, there is no mandatory retirement in employment in B.C.

Need help with your retirement plans and employment? Talk to Yeager Employment Law - we're here to help you today.

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