Commencement of the Employment (Contractual Retirement Ages) Act 2025

The Employment (Contractual Retirement Ages) Act 2025 (the 2025 Act) will take effect from 29 June 2026, following a Commencement Order by the Minister for Enterprise, Tourism and Employment. The period between enactment and commencement allowed for the Workplace Relations Commission (WRC) to publish its updated Code of Practice on Longer Working (the Code), which is intended to support employers and employees in the practical operation of the new regime. The Code will also take effect from 29 June 2026.

The 2025 Act introduces measures which allow employees to notify their employer if they do not consent to retire at the contractual retirement age (CRA) provided for in their contract. This applies specifically to situations where an employee has a CRA below the State pension age of 66. Employers relying on a CRA below 66 will need to be prepared to demonstrate that the CRA of the notifying employee is objectively and reasonably justified by a legitimate aim and that it is appropriate and necessary to achieve that aim.

Updated Code of Practice

The updated Code includes specific guidance on how the notification process under the 2025 Act should operate in practice. It now distinguishes between employees seeking to rely on the new statutory notification process where their CRA is below the State pension age, and employees aged 66 or over who wish to request longer working under the existing framework.

For employees seeking to rely on the 2025 Act, the Code sets out the steps to be followed when notifying an employer that they do not consent to retire. In particular:

• the notification must be made in writing
• it should clearly state that the employee does not consent to being retired at the CRA
• it must be given at least 3 months before the employee is due to retire but not more than 1 year before the contractual retirement date (though employers may provide for a notification period of up to 6 months)
• it should identify the legal basis for the employee’s notification as set out in section 5(1) of the 2025 Act
• an employee can withdraw their notice in line with their contractual or statutory notice period, whichever is shorter

Where an employer receives a notification, they should not enforce the CRA unless they decide the CRA can be objectively and reasonably justified by a legitimate aim, and that the means of achieving that aim are appropriate and necessary. They must provide a reasoned written reply to the employee setting out the justification for enforcing the CRA within one month of having received the notification. If a notification request is accepted or a new retirement age is agreed, this should be amended in the employment contract for the employee.

From an employer perspective, the Code also identifies practical steps that can be taken to ensure existing retirement arrangements take account of the 2025 Act, including reviewing CRA clauses in template employment contracts and retirement policies. The Code also addresses withdrawal of notifications and protection from penalisation.

The Code includes sample template materials for employers and employees, including a contractual retirement age policy guideline for employers and a template notification letter for employees.

Penalties

The 2025 Act introduces a new penalty for employers, for a failure to meet its obligations under the Act. The employee can bring a claim before the WRC within 6 months of the breach.  For well-founded claims, the WRC may make orders requiring the employer to address the breach or award compensation up to 104 weeks’ remuneration or €40,000 (whichever is greater).

The 2025 Act also creates separate criminal liability for certain breaches. In particular, an employer who fails, without reasonable cause, to provide a reasoned written response to an employee’s notification may commit an offence punishable on conviction by a fine of up to €5,000, imprisonment for up to 12 months, or both. Where the employer is a company, corporate officer liability may also arise for directors, managers, secretaries or other officers where the offence was committed with their consent or connivance.

Immediate steps

Employers with a CRA below 66 should now review the basis on which those retirement ages are operated. Employers should also be aware of greater levels of engagement from employees who wish to remain in work beyond their CRA, particularly where that age is below the State pension age. This is consistent with a broader trend towards supporting an aging workforce, and the number of age related claims before the WRC.

From commencement on 29 June 2026, employers should have a clear process in place for managing employee notifications under the new regime, including assessing the notification and, if enforcing the CRA, issuing a reasoned written response within the required timeframe. Employers should also consider preparing guidance for managers and HR teams on handling requests to work beyond the CRA both up and beyond age 66.

Any approach to contractual retirement ages should also be considered in light of the Employment Equality Acts, which will continue to apply regardless of the contractual retirement age adopted.

The Department of Enterprise, Tourism and Employment have published an update on the 2025 Act and its impacts for employers and employees here.

For further information in relation to this topic please contact Michael Doyle, Partner, Emer Murphy, Senior Associate, Rachel-Maria Moore, Solicitor or any member of the ALG Employment team.

 Date published: 18 June 2026