On December 12, 2006, Ontario joins the ranks of jurisdictions allowing employees to choose their own retirement date, courtesy of the Ending Mandatory Retirement Statute Law Amendment Act, 2005. As we alerted readers previously, the legislation was passed in December, 2005 but employers were given one year before the legislation took effect in order to make necessary amendments to employment policies and practices.
To recap, the legislation amended the definition of "age" in subsection 10(1) of the Ontario Human Rights Code in order to protect persons aged 65 and older against age discrimination in employment. Mandatory retirement will only be permitted if there is a "bona fide occupational requirement" as determined under the Human Rights Code.
Other key elements of the legislation:
Collective Agreements
- Existing mandatory retirement provisions in current collective agreements will no longer be enforceable.
- Nothing in the Act prevents unions and employers from negotiating early retirement incentives for workers.
Pension Benefits
- Employees could continue membership in pension plans and accrue benefits past age 65 subject to service or contribution caps of the pension plan.
- Ending mandatory retirement will not affect the entitlement of individuals in Ontario to access CPP at age 65.
Employment Benefits
- Government benefits such as the Ontario Drug Benefit Plan continue to be available for those aged 65 and over.
Notice of Termination After Age 65
Workplace Safety and Insurance
- Workers who are aged 63 or more at the time of an injury will continue to be able to receive loss of earning benefits for up to two years.
- Workers who are injured before age 63 will cease to receive loss of earning benefits at age 65.
Other Changes
With mandatory retirement no longer an option in provincially regulated workplaces in Ontario (except as a "bona fide occupational requirement"), employers who still have mandatory retirement policies will find that they are not enforceable. Employers will have to revise employment policies which call for mandatory retirement. More importantly, they will have to consider the impact of accommodating aging employees who continue to work.
Any member of our Employment and Labour Relations Group will be pleased to advise you of your obligations in a post mandatory retirement era.
The foregoing provides only an overview. Readers are cautioned against making any decisions based on this material alone. Rather, a qualified lawyer should be consulted.
© Copyright 2007 McMillan Binch Mendelsohn LLP
