On 29 June 2026, the Employment (Contractual Retirement Ages) Act 2025 (the ‘Act‘) came into force, introducing a new statutory framework relevant to employers imposing contractual retirement ages below the State pension age, which is currently 66.
Who is Affected by the Act?
As discussed in our earlier article (available here), the Act creates a new right for certain employees to notify their employer that they do not consent to retire at the contractual retirement age where that age is below 66 (the current State pension age).
The Act applies only where employees are subject to a contractual retirement age below the State pension age, have completed their probationary period and have notified their employer that they wish to continue working until at least their 66th birthday. This notification must be submitted not more than one year and not less than three months before the contractual retirement date, save where the employee’s contractual notice period is greater than three months, in which case they must give the shorter of their contractual notice period or six months’ notice.
Employer Obligations Following a Notification
Where a valid notification is received, if the employer wishes to enforce the contractual retirement age and to require, without the employee’s agreement, that the employee retire before reaching the State pension age, it must provide a reasoned written reply within one month of receiving the notification. The employer must objectively and reasonably justify the imposition of the contractual retirement age by reference to a legitimate aim and demonstrate that the means of achieving that aim are appropriate and necessary.
The legislation also contains protections for employees who seek to exercise their rights under the Act. Employees are protected from penalisation for making a notification and complaints may be referred to the Workplace Relations Commission (‘WRC‘) where an employee believes the statutory requirements have not been complied with. Potential remedies include reinstatement or compensation of up to two years’ pay or €40,000, whichever is greater.
Updated Code of Practice on Longer Working
The commencement of the Act has also been accompanied by the publication of an updated WRC Code of Practice on Longer Working (the ‘Code‘) (available here), which took effect on the same date. The updated Code replaces the previous 2017 equivalent and provides practical guidance on the operation of the new legislation, as well as broader guidance concerning requests for longer working by employees aged 66 and over. While the Code is not legally binding, it provides a source of guidance for employers navigating retirement-related issues and is admissible in evidence in the WRC and Labour Court.
Practical Steps for Employers
Employers could conduct an assessment of contractual retirement ages, consider the objective aim being pursued and ensure that the imposition of a contractual retirement age is necessary and appropriate to achieve such aim.
They may also want to take time to review existing retirement arrangements, identify employees who may be affected by the new legislation, update handbook and policy documentation where necessary and ensure that HR teams and managers understand the notification and response requirements.
The commencement of the Act marks a notable development in Ireland’s retirement framework and will require employers operating contractual retirement ages below the State pension age to ensure their arrangements comply with the new statutory requirements.
