McGuinty Government Introduces Legislation To End Mandatory Retirement

Archived Release

McGuinty Government Introduces Legislation To End Mandatory Retirement

Plan Offers Fairness And Choice; Protects Existing Rights And Benefits TORONTO, June 7 - The McGuinty government is introducing legislation that would end mandatory retirement and provide greater fairness and choice for workers aged 65 and older, Labour Minister Chris Bentley announced today. "People are healthier and living longer so it is unfair to insist that they stop working simply because they turn 65," said Bentley. "Ending mandatory retirement would allow workers to retire based on lifestyle, circumstance and priorities. We listened to the needs and concerns of business, labour and others who have consulted with us and are doing this in a way that protects existing rights to pension, early retirement and benefit plans." The Ontario Human Rights Code currently does not protect people aged 65 and over from age discrimination for employment purposes. As a result, employees can be forced to retire at age 65. If passed, the proposed legislation would amend the code and a variety of other statutes that have provisions connected to mandatory retirement. Among other things, the legislation would: - Become effective one year after it receives Royal assent - Continue to allow mandatory retirement where it can be justified on "bona fide occupational requirement" grounds determined under the Human Rights Code (i.e. where there is a requirement or qualification necessary for the performance of essential job duties). The government held public meetings across the province last September to promote discussion and gather public input on mandatory retirement, hearing from 50 groups and more than 100 individuals. The legislation being introduced today responds to the issues raised. "After listening to the concerns of the people of Ontario, we've taken a fair and responsible approach in preparing this legislation," said Bentley. "It's a topic with complex issues. We believe the outcome will be to the benefit of all Ontarians." Disponible en français www.gov.on.ca/lab/ Backgrounder ------------------------------------------------------------------------- June 7, 2005 ENDING MANDATORY RETIREMENT IN ONTARIO The McGuinty government has introduced legislation that would, if passed, end mandatory retirement and give Ontario workers the right to choose when they want to retire. The government plan would achieve this objective without undermining early retirement rights or existing benefit and pension plans. Mandatory Retirement in Ontario The Ontario Human Rights Code (code) prohibits discrimination in employment on the basis of age. For the purpose of employment, the code defines "age" as being 18 years and older, but less than 65. As a result, workplace policies can force workers aged 65 or older to retire. Our Society Like many other countries, Canada has an aging population. People are living longer, staying healthier and remaining independent past age 65. Many want to continue to be active and productive in their individual pursuits, including paid employment and community involvement. According to Statistics Canada, the number of Canadians aged 65 and over is expected to double from nearly four million in 2000 to almost eight million by 2028. In 2001, 11.8 per cent of the Canadian population aged 65 to 69 was employed. While there is a trend towards early retirement, more than 20 per cent of workers aged 45 and up plan to retire after age 65 or not at all. As well, groups such as recent immigrants and women may be disadvantaged by the current mandatory retirement policies. Immigrants often enter the Ontario workforce later in their careers. As a result, they may have to work longer to ensure their financial security later in life. Many women temporarily withdraw from the workforce for family or other reasons. As a result, they may lack adequate funds to retire and would like to continue in paid employment past age 65. Ending mandatory retirement would allow workers to choose when they want to retire based on their lifestyles, circumstances and priorities, and allow those who wish to continue to work past age 65 to do so. Other Jurisdictions There are national and international trends that support workers continuing to work beyond the traditional retirement age of 65. Ontario is not the first jurisdiction in Canada to move in this direction. A number of provinces and territories including Manitoba, Quebec, and Yukon do not allow mandatory retirement. A number of countries, including the USA, Australia and New Zealand, have ended mandatory retirement. Workforce Impact Experiences in other jurisdictions indicate that ending mandatory retirement has had little impact on the labour market. In Ontario, only about 4,000 people a year are expected to take advantage of the change. That is 0.06 per cent of the total 6.6 million Ontario workforce as it stood in 2003. Meanwhile, a trend toward early retirement in some segments of the workforce continues. Ending mandatory retirement is all about providing more individual choice. "Bona Fide Occupational Requirements" A "bona fide occupational requirement" (BFOR) is an employment requirement or qualification that is necessary for the performance of essential job duties. Due to the nature of some jobs, an employee may be required to stop working at a specified age such as 65 or even younger. In such cases, the employer must show that: - An age-based job requirement or qualification is a BFOR - The employee does not meet the job requirement or qualification - The employee could not be accommodated without causing undue hardship to the employer. Ontario Human Rights Commission In June 2001, the Ontario Human Rights Commission released the paper, Time for Action: Advancing Human Rights for Older Ontarians. In it, the commission asserted that mandatory retirement policies undermine the dignity and sense of self-worth of older workers. The commission called for a change of the definition of age in the code to end mandatory retirement. This change would mean that a person's age could not be used to determine when he or she has to leave the workforce. Public Consultations The government held public consultations in a variety of locations across Ontario in September 2004. Led by Kevin Flynn, Parliamentary Assistant to the Minister of Labour, the sessions heard from 100 individuals and 50 groups and organizations. Meetings were also held with 17 stakeholder and expert groups. Among written submissions received was one from the Ontario Human Rights Commission. Disponible en français www.gov.on.ca/lab/ Backgrounder ------------------------------------------------------------------------- June 7, 2005 ENDING MANDATORY RETIREMENT: LEGISLATIVE CHANGES Ending mandatory retirement would require changes to a number of Ontario statutes. Here are the key amendments. Ontario Human Rights Code: - The definition of "age" in subsection 10(1) of the code would be amended to remove the age 65 cap on discrimination in employment. Employment Standards Act, 2000: - Currently, the Employment Standards Act, 2000 (ESA) provides that an individual whose employment is terminated at age 65 as a result of a mandatory retirement policy or practice is not entitled to notice of termination or pay in lieu. With the elimination of mandatory retirement, all eligible employees, regardless of age, would be entitled to receive notice of termination or pay in lieu of notice when their employment is ended by the employer. However, employees who continue to be subject to a mandatory retirement policy or practice that is permitted under the Human Rights Code would not be entitled to notice of termination or pay in lieu. Election Act: - The provision that the Lieutenant Governor in Council may remove from office any returning officer who is 65 years of age would be repealed. Health Protection and Promotion Act: - The provision for the mandatory retirement of medical officers of health and associate medical officers of health at age 65 would be repealed. Ombudsman Act: - The requirement for the retirement of the Ombudsman at age 65 would be repealed. Coroner's Act: - The requirement for the retirement of coroners at age 70 would be repealed. Public Service Act: - The requirement that Ontario government civil servants retire at age 65 would be repealed. Workplace Safety and Insurance Act, 1997: - The Workplace Safety and Insurance Act, 1997 and its predecessor, the Workers Compensation Act, and all regulations, policies and decisions made under them would be exempted to allow maintenance of the status quo. Disponible en français www.gov.on.ca/lab/ Backgrounder ------------------------------------------------------------------------- June 7, 2005 ENDING MANDATORY RETIREMENT: WHAT IT MEANS TO YOU Ending mandatory retirement would affect Ontarians in a variety of ways. Here are some of the key elements proposed. Protection Against Age Discrimination: - The Ontario Human Rights Code would be changed to ban mandatory retirement in Ontario, protecting people 65 and older against age discrimination in employment. A single exception is where mandatory retirement could be justified on "bona fide occupational requirement" grounds determined under the code. Transition Period: - A transition period of one year is proposed to allow workplaces time to adjust to the elimination of mandatory retirement. Some employers would need to reconfigure their employment policies and programs. Mandatory retirement would be eliminated exactly one year after the legislation received Royal assent. Collective Agreements: - Collective agreements would no longer be permitted to include provisions requiring mandatory retirement, except in those cases where mandatory retirement would be allowed under the Human Rights Code as a "bona fide occupational requirement". - Unions and employers would still be able to negotiate voluntary retirement incentives (i.e. early retirement packages). - Mandatory retirement provisions in existing collective agreements would no longer be enforceable once the proposed legislation comes into effect, one year after Royal assent. Pensions: - Ending mandatory retirement would not have an impact on pension benefits already earned. - Employees could continue membership in pension plans and accrue benefits past age 65 subject to service or contribution caps. Canada Pension Plan: - The legislation would not affect eligibility to receive Canada Pension Plan (CPP) at age 65. Ending mandatory retirement will not affect the entitlement of individuals in Ontario to access CPP at age 65. - CPP, Old Age Security and Guaranteed Income Supplement are administered by the federal government. Any changes in eligibility criteria would be a matter for the federal government. - Information about these programs can be obtained directly from the federal government by calling Social Development Canada. By telephone: English: 1-800-277-9914; French: 1-800-277-9915; 1-800-255-4786 (if you use a TYY machine) all are toll-free. Benefits & Insurance Plans: - Currently, under the Employment Standards Act, 2000, employers are prohibited from discriminating on the basis of age in providing benefits to employees aged 18 to 64. This provision would remain in place following the coming-into-force of legislation to end mandatory retirement. - Individuals aged 65 and more would continue to be eligible for government benefits such as the Ontario Drug Benefit Plan. Employment Termination After Age 65: - Employers wishing to dismiss an employee aged 65 or more would have to give that employee termination notice or pay-in-lieu unless an employer's mandatory retirement policy could be justified on "bona fide occupational requirement" grounds. Bona Fide Occupational Requirement: - A "bona fide occupational requirement" is an employment requirement or qualification that is necessary for the performance of essential job duties. These would continue to be permitted under the Human Rights Code. Workplace Insurance - Entitlements under the Workplace Safety and Insurance Act, 1997, would not change. - Injured workers aged 63 or more at the time of injury would continue to be able to receive loss of earning benefits for up to two years. - Workers injured at an age less than 63 would cease to receive loss of earning benefits at age 65. Disponible en français www.gov.on.ca/lab/ Backgrounder ------------------------------------------------------------------------- Updated: October 19, 2005 ENDING MANDATORY RETIREMENT: WHAT IT MEANS TO YOU Ending mandatory retirement would affect Ontarians in a variety of ways. Here are some of the key elements proposed. Protection Against Age Discrimination: - The Ontario Human Rights Code would be amended to prohibit mandatory retirement, protecting employees aged 65 or more from being forced to retire, except in those cases where it could be justified on "bona fide occupational requirement" grounds determined under the code. Transition Period: - A transition period of one year is proposed to allow workplaces time to adjust to the elimination of mandatory retirement. Some employers may need to reconfigure their employment policies and programs. Mandatory retirement would be eliminated exactly one year after the legislation received Royal assent. Collective Agreements: - Collective agreements would no longer be permitted to include provisions requiring mandatory retirement, except in those cases where mandatory retirement would be allowed under the Human Rights Code as a "bona fide occupational requirement". - Unions and employers would still be able to negotiate voluntary retirement incentives (i.e. early retirement packages). - Mandatory retirement provisions in existing collective agreements would no longer be enforceable once the proposed legislation comes into effect, one year after Royal Assent. Pensions: - Ending mandatory retirement would not have an impact on pension benefits already earned. - Employees could continue membership in pension plans and accrue benefits past age 65 subject to service or contribution caps. Canada Pension Plan: - The legislation would not affect Ontarians' eligibility to receive Canada Pension Plan (CPP) at age 65. - CPP, Old Age Security and Guaranteed Income Supplement are administered by the federal government. Any changes in eligibility criteria would be a matter for the federal government. - Information about these programs can be obtained directly from the federal government by calling Social Development Canada. By telephone: English: 1-800-277-9914; French: 1-800-277-9915; 1-800-255-4786 (if you use a TYY machine) all are toll-free. Benefits & Insurance Plans: - Currently, under the Employment Standards Act, 2000, employers are prohibited from discriminating on the basis of age in providing benefits to employees aged 18 to 64. This provision would remain in place following the coming-into-force of legislation to end mandatory retirement. - Nothing in the proposed legislation would prevent employers from providing benefits to employees aged 65 or more. - Individuals aged 65 and more would continue to be eligible for government benefits such as the Ontario Drug Benefit Plan. Employment Termination After Age 65: - An employee dismissed at age 65 or more for a reason unrelated to age would have the same entitlement as a younger employee to notice of termination or pay-in-lieu, unless the employee was forced to retire under a mandatory retirement policy that could be justified on "bona fide occupational requirement" grounds. Bona Fide Occupational Requirement: - A "bona fide occupational requirement" is an employment requirement or qualification that is necessary because of the nature of the employment. These would continue to be permitted under the Human Rights Code. Workplace Insurance: - Entitlements under the Workplace Safety and Insurance Act, 1997, would not change. - Injured workers aged 63 or more at the time of injury would continue to be able to receive loss of earning benefits for up to two years. Disponible en français www.labour.gov.on.caFor further information: Contacts: Peter Fitzpatrick, Minister's Office, (416) 326-7710; Belinda Sutton, Ministry of Labour, (416) 326-7405