By Gemma Villanueva
Business experts and seniors’ groups are having mixed reactions over a new law ending mandatory retirement at age 65 in Ontario, which will allow employees to choose when they want to leave the workforce.
The new legislation comes into effect this Dec. 12, and will amend the Ontario Human Rights Code to protect people aged 65 and over from age discrimination for most jobs. Previously, age discrimination for employment purposes was limited to those over 18 years and under 65.
No law in Ontario requires employees to retire at age 65, but many workplaces have mandatory retirement policies forcing older employees to leave if asked by their employer.
Current exceptions will still apply to those occupations, such as firefighters, where age might relate to job performance.
The legislation also amends other statutes that have rules connected to mandatory retirement. But under the new law, companies will not be required to extend health, disability and life insurance coverage to employees beyond age 64.
All provinces and territories except British Columbia have either ended or modified rules about mandatory retirement. Saskatchewan passed a bill last month, making it the latest jurisdiction to ban mandatory retirement.
Judith Andrew, Ontario vice-president of the Canadian Federation of Independent Business, says the change will help tackle the growing shortage of qualified labour. An estimated 79,500 jobs in small businesses are left vacant in Ontario every year.
“When it comes to retaining experienced and competent staff, [employers] are happy to do what it takes to do that,” she says.
Andrew says basic demographics, such as the aging population and declining birth rates, largely affect the current labour shortage.
She says the new law might encourage a whole new set of flexible working arrangements, such as allowing people to have a three-day work week before easing into retirement.
“This is going to herald a whole new opportunity for people to think about their older years,” says Andrew.
Ontario Minister of Labour Steve Peters says making mandatory retirement illegal was necessary since the human rights commissioner ruled that it was age discrimination.
“There’s nothing in the law that will prohibit an employer from providing benefits beyond the age 65,” he says, adding that the government wanted a balance between the interests of people who want to work into their late sixties and the existing benefits provided by their employers.
He says he does not expect a major impact on the labour market, because it is estimated that only 4,000 of Ontario’s current 6.5 million workers will take advantage of the new law.
“This is the right thing to do,” he says. “Just because someone turns 65, doesn’t mean that they no longer have the ability to make a contribution to society.”
Judy Cutler, director of government relations for CARP, which is Canada’s Association for the Fifty-Plus, says she expects the bulk of Ontarians will continue retiring in the near future but the new law will still make a difference.
By 2030, she says about one in four Canadians will be over 65 years old.
“There will be enough who stay in the labour market in the workforce to make a difference in terms of not vacating a whole bunch of jobs all at once,” she says.
But not everyone in the labour community agrees that mandatory retirement is an effective solution.
Wayne Samuelson, president of Ontario Federation of Labour, says ending mandatory retirement “leads to a society that is set up to encourage people to work until they drop.”
He says that the need for decent pensions, not ending mandatory retirement, is important for today’s workers.
“I think ultimately this is all part of the pension industry to move back the age of pension,” he says. “While governments don’t admit it, I think there’s an agenda here to follow the lead of other countries and have people working longer.”
Dennis Forcese, who retired in July, says he could have continued working as a sociology and athropology professor at Carleton University since the new law will come into effect before he turns 65. But he looked forward to leaving work behind and enjoy his retirement.
“Throughout your life — from infancy, through school, through employment — your life is being governed by someone else’s time table,” he says. “Now, it’s my own timetable.”
He still teaches, but does not have to follow a formal curriculum with his non-credit course offered to local seniors who are part of Carleton’s Learning in Retirement program.
Forcese says mandatory retirement has its pros and cons. “You can plan for the exit of personnel and the re-entry of new people,” he says, but adds that it is a form of age discrimination.