The Province of British Columbia recently announced that it would end mandatory retirement in British Columbia in the spring session of the Legislature next year. In doing so, it will join Ontario and other provinces that no longer allow employers to compel their employees to retire.
The mechanism for ending mandatory retirement is quite simple. The Human Rights Code of British Columbia currently stipulates that it is not discriminatory for an employer to discriminate on the basis of age if an individual is over 65 years of age. In Ontario, the Human Rights Code was amended to restrict age based discrimination to persons under 18 years of age. Previously, the Ontario Code allowed discrimination on the basis of age under 18 and over 65 years of age. A similar mechanism would likely be used in British Columbia.
The only remnants of age discrimination over 65 that is permitted in Ontario relates to collective agreements. Employees who are covered by a collective agreement which has mandatory retirement language can continue to rely on that language until a collective agreement is renegotiated.
The end of mandatory retirement will likely leave B.C. employers in a state of confusion. Without an ability to mandate retirement, they have no game plan to deal with employees at the end of their careers. Some possible suggestions follow:
1. Phased Retirement
Employers are not obliged to retain employees who cannot perform the essential duties of their work. They should consider performance management programs for all employees, regardless of age. Regular performance reviews would assist employers to determine whether an employee is working effectively. If not, options such as offering retirement packages could be used.
2. Early Retirement Packages
An employer could make available to its workforce the option of taking early retirement. This must, however, be used in a non discriminatory manner. The risk here is that an employer might lose employees that it wishes or needs to retain. Other approaches would be to offer to supplement employee pensions or provide additional years of service credits to activate a full pension entitlement. Employers could also offer to maintain dental and medical benefits and provide retirement counseling to make the retirement option more attractive.
3. Bona Fide Occupational Requirement
In a limited number of cases, an employer may be able to impose mandatory retirement because age is a bona fide occupational requirement. For example, police officers and firefighters may meet this test. There is, however, a high hurdle for an employer to meet in order to apply this standard. Few employers will be able to use mandatory retirement as a viable option.
4. Voluntary Retirement, Termination for Cause, Etc.
Employers always have the ability to dismiss employees for “cause”, regardless of age. This is, of course, a difficult and expensive avenue to pursue. Competence cannot be presumed on the basis of age alone. There must be evidence built up in order to show the employee is not meeting the essential requirements of their work. This requires employers to warn their employees of their shortcomings. There may, as well, be cases where employees are absent due to ill health to the point where their employment contracts becomes frustrated or void as a result.
Reprinted with permission from Clearsite, by Paul A. Devine, Miller Thomson LLP (BC Office), 604-643-1227.
