The Supreme Court of Canada has recently ruled that partners can
be forced to retire at 65. Elderly employees, however, need not
resign themselves to early bird specials just yet. Indeed, there
are a growing number of Canadian employees working beyond 65; proof
positive that the wrinkled ceiling is in decay.
The outdated notion of mandatory retirement hails from late
19th century Germany, when that country became the first
nation to adopt an old-age social insurance program designed by
Germany's Chancellor, Otto von Bismarck, for "those who
are disabled from work by age and invalidity [and] have a
well-grounded claim to care from the state." Despite his
right-wing credentials, Bismarck was labelled a socialist for
introducing such a program. His retort in the Reichstag debates of
the time was, "Call it socialism or whatever you like. It is
the same to me."
There have been significant advancements in health care and a
drastic increase in life expectancy such that employees retiring at
65 is no longer part of the current zeitgeist. Many find the notion
that 65 year olds be put out to pasture quite offensive, myself
After all, there are many benefits to employers who retain older
employees. These employees have been with the company for many
years, building up a significant vault of knowledge and know-how.
The older employee has also had many years to build up a strong
network of relationships that he/she can draw upon in ways that a
younger employee cannot.
The end of mandatory retirement does not mean that older
employees cannot be terminated. Rather, an employer cannot
arbitrarily impose a contractual term or policy requiring an
employee to leave employment at age 65. Now that mandatory
retirement is dead and older employees are poking holes in the
wrinkled ceiling with their walking sticks, employers must
carefully consider a number of issues when terminating the older
Employers' attempts to nickel and dime older employees by
offering reduced severance packages on the basis that the employee
will retire at 65 is no longer acceptable. Over the past several
years, courts have awarded generous notice periods to the older
terminated employee, sometimes in excess of 24 months.
In a 2013 decision by the Ontario Superior Court of Justice in
Filiatrault v. Tri-County Welding Supplies Ltd., the court
recognized that there were few, if any, cases where the courts have
awarded notice periods in excess of 24 months but that the few
higher notice periods have been awarded to those employees in their
60s and above.
This case, and others, indicate that given the end of mandatory
retirement, notice periods will be awarded in excess of 24 months
as the workforce becomes increasingly populated by older workers
with longer periods of service and little opportunity to replace
their employment at an advanced age. The termination of an older
employee often means the end of their work related career.
Employers wishing to limit their liability on the termination of
older employees should consider their options, such as providing
the older employee with working notice, offering incentives to
older employees such as attractive pension plans as well as work on
special projects on a consensual basis.
The end to mandatory retirement was implemented by provincial
and federal amendments to human rights legislation. Employees are
now protected from age discrimination beyond 65 years.
Not only can older employees bring an application to the Human
Rights Tribunal when they believe they are being discriminated
against on the basis of age, but now terminated employees can also
claim damages for breach of this protected human right as part of a
wrongful dismissal claim, which can result in an award of
additional damages for discrimination.
Employers also need to "accommodate" older employees
in accordance with current human rights legislation. This issue of
"accommodation" has become increasingly important as the
number of older employees in the workforce grows.
As the rising tide of geriatric employees swells, employers must
consider these and related issues.
However, the experience and wisdom that forms part of the older
workforce may provide a benefit not yet fully appreciated by
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guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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Unfortunately, reasonable accommodation for employees in the workplace continues to be the source of significant litigation and even today we continue to see outrageous examples of employers behaving badly.
We are now beginning to see reported cases involving charges and subsequent fines laid against employers for failing to provide information, instruction and supervision to protect a worker from workplace violence.
On October 13, 2016, the Supreme Court of Canada denied leave to appeal an Ontario Court of Appeal decision which ordered an employer to pay a former employee 37 months of salary and benefits following termination.
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