Compulsory retirement

2.98 While compulsory retirement has been abolished for Commonwealth statutory office holders and other public servants, a number of direct and indirect mandatory retirement practices remain. In addition, while not having a specific compulsory retirement age, a range of other occupations require licensing and re-qualification. Clearly, these practices may create barriers to mature age participation in the workforce.

2.99 As a matter of principle, the ALRC favours individual capacity-based assessment rather than the imposition of compulsory retirement. The imposition of compulsory retirement fails to account for the capacity of individuals, reinforces stereotypes about the abilities of mature age workers and reduces utilisation of the workforce contribution of mature age workers.^[129] National Seniors emphasised that,

while it may be acceptable to have an age determined review point, it is not appropriate to have age determined cut off points. Licensing and re-qualification should be dependent on capacity, not chronological age. People of the same age often have widely differing physical and mental capacity.^[130]

2.100 While recognising that mature age workers should generally decide the time and manner in which they leave the paid workforce, in certain circumstances and instances it may be appropriate for public policy reasons to assess their capacity to remain in their position. For example, the Ai Group emphasised that ‘in some cases these restrictions are necessary and justified on health and safety grounds’.^[131]

2.101 In order to balance the desire to encourage workforce participation of mature age workers with public policy requirements around health and safety, individual capacity-based assessment rather than the imposition of compulsory retirement is a preferable approach.^[132] As suggested by the Law Institute of Victoria, assessment should occur on the basis of a ‘person’s ability to perform the tasks of their particular job, regardless of their age’.^[133] This approach was echoed in submissions by stakeholders such as the ACTU, which ‘generally supports an approach to licensing and/or re-qualification which is based on risk factors rather than age’,^[134] and the Diversity Council, which stated that ‘individuals should only be assessed on whether they can carry out the inherent requirements of the job in question’.^[135]

2.102 In the ALRC’s view, industry and professional bodies are best placed to determine the most appropriate assessment and safeguards for mature age workers in their industry or profession. However, the provision of principles or guidelines may assist such bodies in reviewing licensing or re-qualification requirements with a view to removing age-based restrictions in favour of capacity-based requirements.

Independent reviews of compulsory retirement

2.103 As outlined above, as a matter of principle, the ALRC favours individual capacity-based assessment rather than the imposition of compulsory retirement. However, in certain circumstances and instances it may be appropriate for public policy reasons to assess the capacity of mature age workers to remain in their position. Two key examples of this are judicial and quasi-judicial officers, and Australian Defence Force personnel.

2.104 In order to consider these examples, the ALRC proposes that there should be two independent reviews of existing compulsory retirement—one in relation to judicial and quasi-judicial appointments and the other in relation to the military. This approach is consistent with the one advocated by stakeholders, such as the South Australian Government, which suggested that

it may be more appropriate for those areas that have compulsory retirement ages to be reviewed separately to consider whether the set age limits remain appropriate to the contemporary work practices.^[136]

Judicial and quasi-judicial officers

2.105 Under s 72 of the Australian Constitution, the maximum age for Justices of the High Court and any court created by Parliament is 70 years.^[137] While the section provides that Parliament may make a law fixing a lower age, it does not make such provision for a higher age.^[138]

2.106 There is jurisdictional inconsistency in the compulsory retirement provisions relating to judicial and quasi-judicial officers, such as Ombudsmen. Under state and territory constitutions and legislation compulsory retirement ages range from age 65 to 72 years of age.^[139]

2.107 The Government of South Australia favoured national consistency and observed that, although the compulsory retirement provisions affect a relatively small number of people, they have important symbolic implications with respect to the Australian Government’s view of the ‘capacity of people to work competently until they are of a certain age’.^[140]

2.108 Other stakeholders such as National Seniors supported the removal of compulsory retirement ages for judicial officers, consistent with the ‘abolition of compulsory retirement ages for Commonwealth statutory office holders and public servants’.^[141]

2.109 There are certain complexities associated with removing compulsory retirement for judicial officers, including Constitutional requirements and public policy reasons for compulsory retirement. There may also be flow on effects with respect to judicial pensions.^[142]

2.110 Rather than proposing the removal of compulsory retirement ages, the ALRC proposes that the Australian Government, in cooperation with state and territory governments, should initiate an inquiry to consider removing the compulsory ages of judicial and quasi-judicial appointments or, at a minimum, to achieve national consistency in such ages.

Military personnel

2.111 The compulsory retirement age for Australian Defence Force (ADF) personnel is 60 years and 65 years for reservists.^[143] However, there is provision for the Minister or the Chief of the Defence Force to extend the compulsory retirement age for either a specific officer or member or a class of officers or members. In the 12 months up to 30 June 2012, 35 ADF personnel were granted an extension to their compulsory retirement age. ^[144]

2.112 While the current average number of years of service for ADF personnel is nine years,^[145] statistics indicate that of the 56,728 ADF personnel, 3,019 were aged 50 years and above and are approaching compulsory retirement age. In August 2012, there were 50 ADF personnel over 60 years of age.^[146]

2.113 The Alliance of Defence Service Organisations (ADSO) emphasised the operational capability reasons for ensuring that ADF personnel ‘deployed into operations are of an age and physical fitness to meet the rigours of battle in defence of the nation’.^[147] ADSO provided two examples:

Firstly, the infantry soldier, wearing body armour and carrying his weapon and a heavy pack, could not cope with the rigours of a fire-fight unless he or she is relatively young, very fit and highly trained; secondly, the pilot, flying a high performance fighter aircraft, capable of pulling 7G and delivering precision weapons in a hostile air environment, could not cope unless he or she is relatively young, very fit and highly trained.^[148]

2.114 The ADSO submitted that ‘the need for a relatively young ADF is obvious and ADSO is very strongly opposed to any change in compulsory retirement age for the ADF’.^[149] However, ADSO did not oppose the current provision for the extension of compulsory retirement age by the Minister or Chief.

2.115 As a matter of principle the ALRC favours individual capacity-based assessment rather than the imposition of compulsory retirement. The Defence, Science and Technology Organisation (DSTO), in partnership with the University of Wollongong, is currently conducting a Physical Employment Standards (PES) Review Project.^[150] In seeking to identify objective criteria for physical standards across the ADF, the ALRC suggests that this, and similar projects, may provide a useful basis upon which to reconsider the compulsory retirement ages.

2.116 The ALRC’s view is that the most appropriate approach to this issue is to propose that the Australian Government initiate an inquiry to review the compulsory retirement ages for ADF personnel. Proposing a review rather than removal of the compulsory retirement ages recognises the concerns expressed by stakeholders such as the ADSO, and the need for a detailed examination of this issue undertaken in cooperation with the ADF and key defence force and veterans organisations. Any such inquiry should consider a range of possible alternatives, including a capacity-based approach and any unintended consequences arising from a change to compulsory retirement ages with respect to the calculation of death and invalidity benefits paid under military superannuation and benefits schemes.^[151]