Is Forced Retirement Legal?

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Gavel and Scales

In most professions, forced retirement based on age is illegal. Although many employers used to have a mandatory retirement age, this practice was eventually prohibited by the federal Age Discrimination in Employment Act (ADEA). The ADEA prohibits discrimination against employees who are at least 40 years old in the terms, conditions, or privilege of employment, including hiring, firing, promotion, layoff, compensation, benefits, job assignments, and training.  It also prohibits retaliation against an employee who opposes discriminatory employment practices, files an age discrimination charge, or files or participates in an age discrimination lawsuit. The ADEA is enforced by the Equal Employment Opportunity Commission (EEOC).

Who Is Covered by the ADEA?

The ADEA applies to private employers with 20 or more employees; the federal government; state and local governments (although state employees may not sue their employers directly for violating the ADEA); employment agencies; and labor organizations. The ADEA protects employees and applicants who are at least 40 years old. Unlike other laws prohibiting discrimination, the ADEA doesn’t outlaw “reverse discrimination.” In other words, the law does not prohibit employers from discriminating against employees who are younger than 40.

Can You Be Forced to Retire?

When Congress first passed the ADEA, it protected only workers between the ages of 40 and 65. Once an employee reached the age of 65, he or she could be forced to retire. However, the ADEA was amended over 25 years ago to protect all employees who are 40 and older. As a result, today it is illegal for employers to adopt a mandatory retirement age.

As is often the case, there are a few exceptions to this general rule. Although employers generally may not adopt a mandatory retirement age, an employer may consider age in the following circumstances:

Public Safety Officers. State and local governments may institute a mandatory retirement age of 55 or older for firefighters and law enforcement officers.

Executives and policy makers. Employers may require a high-ranking employee to retire or step down to a lesser position if the employee is at least 65 years old; the employee has worked for at least the past two years as a bona fide executive or in a high policy-making position; and the employee is entitled to an immediate, non-forfeitable annual retirement benefit of at least $44,000 from the employer.

Bona fide occupational qualification (BFOQ). An employer may consider age in filling a job if age is a BFOQ – that is, if the job, by its very nature, must be filled by an employee of a particular age. This defense is available to an employer only if the age limit or other age-related policy is reasonably necessary to the essence of the employer’s business. One of the following must also be true: 

  • All or substantially all people who are older than the age limit would be unable to perform the job, or 
  • Some people who are older than the age limit would be unable to perform the job and testing each person individually to determine whether he or she can perform the job would be impossible or highly impractical for the employer.

If the employer’s goal in using the BFOQ is public safety, the employer must also show not only that the age limit achieves that goal, but also that there is no acceptable alternative that is less discriminatory. As you can see by these strict requirements, the BFOQ defense will not apply to most occupations. 

Do You Need a Lawyer?

Because forced retirement based on age has been illegal for some time, few employers openly adopt mandatory retirement policies. However, this doesn’t mean that age discrimination no longer happens. If you believe that you are being laid off, fired, or eased out because of your age, or because you have benefits that are about to vest, you should talk to an experienced employment lawyer.

If you are asked to sign a severance agreement, waiver, or release that gives up your right to sue your employer for age discrimination, you should consult with an attorney before signing. The ADEA requires employers who want you to waive your ADEA rights to comply with several requirements, including advising you to talk to a lawyer. The employer must also give you 21 days to consider the severance agreement and seven days to revoke your signature even after you sign.

However, before signing, you should know what rights you are giving up. The only way to figure out whether you are getting a fair deal is to talk to a lawyer and find out whether you have a viable age discrimination claim against your employer. If so, you may be able to negotiate a higher severance with your employer – or pass on the severance altogether and take legal action. A lawyer can help you evaluate your situation and decide on the best strategy.

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