Flexible retirement
Produced in partnership with Wyn Derbyshire of gunnercooke LLP
Flexible retirement

The following Pensions practice note produced in partnership with Wyn Derbyshire of gunnercooke LLP provides comprehensive and up to date legal information covering:

  • Flexible retirement
  • Concept of flexible retirement
  • Legislative framework
  • Before 6 April 2011—the default retirement age exemption
  • Practical problems with flexible retirement
  • Post 6 April 2011 changes
  • Objectively justifying a retirement age
  • Impact of abolition of the default retirement age exemption on pension schemes
  • Life cover exemption
  • The impact of auto-enrolment
  • More...


One consequence of the recent pensions legislation reforms, including the introduction of anti-age discrimination legislation (for more information, see Practice Note: Age discrimination—an introduction), has been to allow the introduction of a new and greater flexibility in the ability of members of registered pension schemes to accrue and ultimately receive benefits from such schemes. In particular, recent years have seen the development of the concept of ‘flexible retirement’.

Concept of flexible retirement

Broadly speaking, flexible retirement encapsulates the ability of members to:

  1. commence receipt of benefits from registered pension schemes while remaining in active service with the sponsoring employer of their pension arrangements, and

  2. continue to accrue benefits if they so wish after normal pension date (typically age 65) and in ways that comply with the age discrimination legislation

Legislative framework

Since A Day (on 6 April 2006), registered pension schemes have not been required to maintain a normal retirement date. Instead, the Finance Act 2004 (FA 2004) refers to a ‘normal minimum pension age’ which needs to be attained before certain authorised member payments can be made. Since 6 April 2010, the normal minimum pension age is 55.

However, there is nothing in legislation which prevents:

  1. the scheme rules from continuing to have a normal retirement date, or

  2. an employee’s employment contract or the scheme rules from requiring that

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