How is my retirement age determined when my retirement age is not indicated in my service contract and my employer also has no written policy regarding a retirement age?
Section 187(2)(b) of the Labour Relations Act (No. 66 van 1995) stipulates that the termination of an employee’s service, based on the employee’s age, will be fair if the employee has reached the normal retirement age of the workplace or when the employee has reached a retirement age agreed upon between the employer and employee.
In the verdict with regard to Rubin Sportswear v SA Clothing & Textile Workers Union & others (2004) 25 ILJ 167 (LAC) the court considered the meaning of a normal retirement age. The court looked at, inter alia, judicial and dictionary definitions and found that the words refer to what can be associated with a so-called norm and can be applied to other employees appointed in the same capacity as the person whose termination of service was the subject of discussion.
The court further ruled that a certain age cannot suddenly become a normal retirement age simply because the employer has decided that it should be the right retirement age. The employer can suggest a certain age as the retirement age to his employees and if the employees accept the suggestion, this will become the retirement age agreed upon and applicable to the employees who agreed to it. Such an agreed-upon retirement age becomes a normal retirement age when employees have retired at that age for such a long time that it has become the norm.
If an employer cannot prove that a norm has been created over a reasonable period with regard to a specific age at which employees have to retire and that the employees have been aware of this norm, the employer will be obliged to try to negotiate a retirement age with the employee and agree on such age. This means that the employer must give the employee a reasonable and fair opportunity during a consultation process to give input and to take part in order to determine a retirement age agreed upon.
If the employee is forced to retire at a certain age without such a consultation process having been followed and without a normal retirement age being present at the workplace, the employee will possibly be able to refer a dispute as a result of automatic unfair dismissal in terms of section 187(1)(f) to the labour court.
Author: Hendrik van der Hoven