Employment Contractual Retirement Ages Act 2025 Commences

Irish employers facing workforce planning changes must adapt to the newly commenced Employment (Contractual Retirement Ages) Act 2025, which limits the ability of businesses to enforce mandatory retirement ages below the State pension age of 66.

Under the new legislation, employees with a contractual retirement age below 66 can notify their employer in writing that they do not consent to retire. Upon receiving this notice, the employer has one month to provide a reasoned written reply that objectively justifies the mandatory retirement age. This justification must prove that the specified age serves a legitimate aim and is achieved through appropriate and necessary means.

Should an employer fail to deliver this reasoned response within the one-month window, the employee cannot be forced to retire before reaching age 66, unless an alternative date is mutually agreed.

The Act, which commenced in June 2026, aims to eliminate the income gap experienced by workers forced into retirement before they can access the State pension. Due to a mandatory three-month notification period, the earliest contractual retirement date affected by the new rules is 29 September 2026.

This law applies strictly to contractual retirement ages below 66. It does not apply to statutory retirement ages set for public servants, such as members of the Defence Forces. Employees can seek redress under the Workplace Relations Act if employers fail to comply with the new statutory requirements.