Can you outline what this new piece of legislation is about?
The Employment (Contractual Retirement Ages) Act 2025 creates a new employment right that allows eligible employees to notify their employer that they do not consent to retire at the contractual retirement age, where this is lower than the State pension age of 66.
However, employees are not obliged to remain in employment beyond their contractual retirement age if they do not wish to do so.
The Employment Contractual Retirement Age Act 2025 came into effect here in Ireland on June 29th 2026.
Will an employee need to give notice that they wish to stay until they are 66 years?
Employees will need to give a minimum of 3 months notice before their expected retirement date but not more than a year, and this notice needs to be in writing.
If an employee’s contract requires a longer notice period than 3 months, they must give either this amount or 6 months’ notice, whichever is shorter.
Can an employer refuse a request from an employee to remain in work beyond their retirement age up until aged 66?
Employers will be required to respond to written requests from employees in writing within 1 month of receiving it, explaining their reasons if they are refusing a request.
Employers cannot require an employee to retire before aged 66 years unless they can clearly justify this decision. They will need to clearly show that the retirement is objectively and reasonably justified by a legitimate aim.
What is the penalisation if an employer doesn’t comply with the rules under the act?
An employee can bring a complaint to the Workplace Relations Commission (WRC) where an employer does not comply with its obligations under the Act. The WRC may:
- Declare that the complaint is or is not well founded
- Require the employer to take a specified course of action, including re-instatement or re-engagement
- Require the employer to pay the employee compensation of maximum 104 times the employee’s weekly salary or €40,000, whichever is greater
What if an employer doesn’t respond to an employee’s request?
This is an offence and is punishable by a fine not exceeding €5,000 or a maximum 12-month prison term, or both. Where this offence is committed by a company with the consent or knowledge of a director, manager, secretary or other officer of the company, that person shall also be guilty of an offence.
Are there any employers that are excluded from this new requirement?
Yes, certain employment relationships like the prison service, the Gardai and the Fire Service are excluded from the Act, for example those jobs that are subject to a maximum retirement age by law or one that is subject to a statutory maximum service limit.
Will there be any supports and guidance for employers?
- ISME have updated the Retirement Policy on our HR Hub, and members can access this by logging into the HR Hub on the ISME Website.
- The Workplace Relations Commission’s (WRC) updated ‘Code of Practice on Longer Working’ will provide guidance on how this new employment right works in practice. It will contain key practical information including templates for employers and employees to use. This Code of Practice is available here
Do you have any practical tips for employers on what they should do right now?
- Employers should review their policy and procedure/Handbooks, to ensure the retirement age is clear and that notification requirements and the process required is updated.
- Where an employer accepts an employee’s notification request, arrangements should be made to reflect the employee’s continuation in employment in their contract of employment.
- If an employer plans to keep their retirement age as is and it’s less than 66 years, they will need to think objectively about their reasons and ensure they are able to justify them by legitimate aims. The Code of Practice as mentioned above should assist employers with this.
- Identify employees that are subject to a contractual retirement age below 66 and who are due to reach this age in the next 18 – 24 months. Where appropriate, encourage early, informal discussions with employees approaching retirement age to manage expectations and reduce the likelihood of disputes. Apply retirement ages and justifications consistently across comparable roles to mitigate discrimination risk.
- If an employer decides to extend the retirement age following a request by an employee, check how this extended employment may interact with occupational pension schemes, insurance cover and other age-related benefits, and take advice where necessary.
