At the end of June the Minister for Enterprise, Tourism and Employment, Peter Burke TD, announced that the Employment (Contractual Retirement Ages) Act 2025 had come into effect, introducing a substantial new employment rights for workers in Ireland.

The legislation allows eligible employees to choose to remain in employment beyond their contractual retirement age, where that age is below the State Pension age of 66.

Many employees have been forced to retire at the traditional retirement age of 65, as stated in their employment contracts, one year before the State pension commences. These new rules will give workers the option to work for an additional year to bridge that gap but there will be no requirement to do so.

The Department of Enterprise, Trade and Employment says that the act gives employees choice and does not require anyone to stay in work if they prefer to retire.

It will allow people to formally notify their employer that they do not consent to retire at their contractual retirement age and that they wish to remain in employment until they reach the State Pension age.

To do so, they must provide:

• at least 3 months’ notice, and
• no more than 12 months’ notice before the intended retirement date

Where a contract specifies a longer notice period, employees must give that notice or 6 months (whichever is shorter). Due to the minimum notice requirement, the earliest contractual retirement date the Act can apply to is 29 September 2026.

Employers are required to carefully consider any notification made under the Act.

Where an employer intends to enforce a retirement age, they must:

• respond in writing within one month
• clearly set out the decision and ensure that it complies with the higher legal threshold set out in the Act

Minister Peter Burke TD said, “I am very pleased to announce the commencement of the Employment (Contractual Retirement Ages) Act 2025 on 29^th June, which represents an important step forward in strengthening the rights of older workers in Ireland. This legislation gives employees greater choice and flexibility by allowing them to remain in employment until the State Pension age, if they wish to do so.

“This new employment right delivers on the government’s commitment in response to the Pensions Commission Recommendations and Implementation Plan.”

The act does not apply to employees with a retirement age of 66 or higher, or those whose retirement age is set by law, such as gardaí and members of the Defence Forces.

NB – This is a guide for information purposes only and does not constitute legal advice. If you have an issue requiring legal advice, please contact any of the team at Nolan Farrell & Goff LLP, whose numbers can be found on our website www.nfg.ie, or email info@nfg.ie.