By Dems Nel
There is no law in South Africa that prescribes or determines a specific retirement age. However, the retirement age is regulated internally by employers through policies and general practice. Abovementioned can only be amended by an agreement between the parties. Furthermore, employees and employers can negotiate individually for early retirement. If the employee does not agree though, the employer cannot force and employee to take early retirement.
Section 6(1) of the Employment Equity Act (No. 55 of 1998) stipulates that no may be discriminated against based on any grounds, and one of these grounds specifically mentioned is age. Furthermore, section 187(1)(f) of the Labour Relations Act (No. 66 van 1995) determines that the dismissal of an employee based on their age will automatically result in unfair dismissal and that the Labour Court can award compensation of up to 24 months of the employee’s salary.
Section 187(2)(b) of the Labour Relations Act contains an exception to the rule and determines that an employee can be forced to retire if he or she reached the normal or agreed upon retirement age.
In Schweitzer v Waco Distributors (A Division of Voltex (Pty) Ltd  10 BLLR (LC) the court found that there are three questions that must be asked when someone is dismissed based on their age, namely:
- Was the service ended due to the employee’s age?
- Is there an agreed upon or determined retirement age?
- Has the employee reached this specified age?
If all three questions were answered confirming to be the truth, there are no grounds to refer the matter to the Labour Court.
In Karan t/a Karan Beef Feedlot v Randall  11 BLLR 1093 (LAC), the employer notified the employee in writing that he reached the agreed upon retirement age, but that he may continue to work and that the contractual notice period will count. The employee merely continued to work and gave no sign of objection. Two years later the employer notified the employee that he must retire and gave him 30 days’ notice. The employee referred a dispute and the Labour Appeal Court found that the employee accepted the conditions of the continued working relationship since he made no objection to the employer’s writing that he may continue to work and that the normal contractual notice period will be valid. The employee’s claim was dismissed.
In the unreported case of Hilary Truter v Carecross (Pty) Ltd C956/2013 the employer forced the employee to retire at 65 despite the fact that there were employees older than 70 still working. Furthermore, there was no retirement age in the contract and no retirement age was given to the employee. On merits of the abovementioned, the employer could not prove that there was a normal or agreed upon retirement age and therefore the dismissal automatically resulted in being unfair and the employee was re-employed with retroactive effect.
In BMW (South Africa) (Pty) Limited v National Union of Metalworkers of South Africa and another  JOL 40518 (LAC), an employee approached the court because she was forced to retire at 60 despite the fact that the employer’s policy at the time of the applicant’s appointment made provision for a retirement age of 65. However, the policy was amended to a retirement age of 60 years before her retirement. The employer agreed that the policy could not be amended unilaterally. Unfortunately, the employee could not prove that she did not accept the amendment and wanted to object to it. The employee only objected to the retirement age once she came close to retirement. The court found it unlikely and that it could not be proved that she objected to the changes when they were made, thus she accepted the changes and agreed to retire at 60. The employer, therefore had no remedy at her disposal.
The court dealt with the question of whether an employer can unilaterally change an employee’s retirement age in Legal Aid South Africa v Theunissen  4 BLLR 370 (LAC). The employee had an employment contract that included some policies. The retirement age was determined to be 65 in one of these policies. However, the employer amended this policy at a later stage and changed the retirement age to 60. The change was made after careful consultation with the representative unions and in line with the requirements as prescribed by the internal policies. The Labour Court found that the applicant had to be re-employed. However, the Labour Appeal Court set aside the ruling and found that the employer acted within its rights and that it was entitled to change the policy and lower the retirement age. Part of the reason for the decision was that the employment contract did not stipulate a specific retirement age and that it was regulated by the policies. The policies were adjusted after adequate consultation and thus were legitimate.
In the case of Hibbert v ARB Electrical Wholesalers (Pty) Ltd  2 BLLR 189 (LC) the court limited the employee’s compensation to 12 months despite the fact that the employer could not prove that there was a determined retirement age and forced the employee to retire at 65. The compensation was limited to 12 months because the employer’s decision was not the most egregious form of unfair discrimination.
In Rubin Sportswear v SA Clothing & Textile Workers Union and others (2004) 25 ILJ 1671 (LAC), the court found that section 187(1)(b) established two grounds for terminating services based on age. These two grounds are the reaching of the agreed upon retirement age or the normal retirement age.
In Cash Paymaster Services (Pty) Ltd v Browne (2006) 27 ILJ 281 (LAC) the court found that there should be referred to a normal retirement age only if there is no agreed upon retirement age. Thus, the terms of the employment contract will prevail if there is a discrepancy.
In Botha v Du Toit Vrey and Partners CC (2005) JOL 15760 (LC) it was found that if there is a norm in the industry, the employer can be expected to retire at that age. In this particular case, it was found that the general norm in the municipal sector is to retire at the age of 65. If there is uncertainty, an expert can be called in to testify about the normal retirement age in the industry.
If a retirement age is included in an employment contract, the employee may be forced to retire at that age. Employers therefore cannot unilaterally change employees’ retirement age. If the retirement age is not included in the agreement, but in the employer’s policy and the employer changes the policy that regulates retirement, it will have to comply with the requirements for amendment, as contained in the policy, and the employer must consult with the interested parties. However, the employee still has an obligation to notify the employer in writing if he or she does not accept the amendment. If the employee does not act and simply ignores it, it is assumed that the employee has agreed to the change.
- Schweitzer v Waco Distributors (A Division of Voltex (Pty) Ltd  10 BLLR (LC);
• Karan t/a Karan Beef Feedlot v Randall  11 BLLR 1093 (LAC);
• Hilary Truter v Carecross (Pty) Ltd C956/2013;
• BMW (South Africa) (Pty) Limited v National Union of Metalworkers of South Africa and another  JOL 40518 (LAC);
• Legal Aid South Africa v Theunissen  4 BLLR 370 (LAC);
• Hibbert v ARB Electrical Wholesalers (Pty) Ltd  2 BLLR 189 (LC);
• Rubin Sportswear v SA Clothing & Textile Workers Union and others (2004) 25 ILJ 1671 (LAC);
• Cash Paymaster Services (Pty) Ltd v Browne (2006) 27 ILJ 281 (LAC);
• Botha v Du Toit Vrey and Partners CC (2005) JOL 15760 (LC).