In its consideration of the German Fuchs v Land Hessen case earlier this month, the ECJ was asked to decide whether keeping costs down could be a relevant factor when deciding whether a compulsory retirement age could be objectively justified.
Gerhard Fuchs was a state prosecutor in the German state of Hessen, who was compelled to retire when he reached the age of 65. TAEN reports, in considering the case, the ECJ decided a German law requiring state prosecutors to retire at 65 on a generous pension was justified - subject to some exceptions.
Chris Ball, chief executive of TAEN, said: "Even though the UK Government has now abolished the default retirement age which gave employers the right to retire their employees when they reached the age of 65, the European Court of Justice (ECJ) has just handed down a decision which may provide employers with wriggle-room on possible objective justifications for compulsory retirements.
"The ruling also appears to hold that a retirement age can potentially be justified to encourage the promotion of a younger workforce. But more controversially, it suggests it is legitimate to retire older workers to prevent possible disputes concerning employees' fitness to work beyond a certain age.
"This could encourage more employers to seek to establish employer-justified retirement ages than have done previously. And, more worryingly, it could open the door for employers to put forward questionable arguments about the fitness of older workers as a reason to retire them off early. "However, employers would be wise to tread cautiously, as the facts will still have to be carefully considered in each case."