Do you have to retire at 70 in Australia? Mandatory Retirement Explained

The number of Australians working into their 70s has significantly increased in recent years, with a KPMG analysis revealing that one in four men are still working at age 70. The short answer to "do you have to retire at 70 in Australia?" is generally no, due to anti-discrimination laws. However, navigating the landscape of work, pensions, and superannuation as an older Australian requires a deeper understanding of the rules and your rights.

Quick Summary

Australia does not enforce a mandatory retirement age for most workers, with the federal Age Discrimination Act 2004 outlawing the practice. The decision to retire is up to the individual, although financial milestones like accessing superannuation at preservation age (now 60 for most) and the Age Pension age (currently 67) heavily influence this timing. While most professions are protected, there are rare exceptions for certain high-level roles.

Key Points

• No Mandatory Retirement Age: The federal Age Discrimination Act 2004 makes it illegal for most Australian employers to force an employee to retire based on their age.

• Rare Exceptions Exist: Mandatory retirement only applies to a few specific occupations, such as federal judges and permanent Australian Defence Force personnel, and is based on other constitutional or legislative requirements.

• Age Pension Eligibility is Not a Retirement Deadline: The eligibility age for the government's Age Pension is 67, but this does not mean you must stop working to receive it. It is a separate financial milestone, subject to means tests.

• Accessing Superannuation Differs: Your 'preservation age,' the earliest age you can access your super, is currently 60 for most Australians and is distinct from the Age Pension age.

• Working Past 70 is a Growing Trend: Many Australians are choosing to work into their 70s for financial security, to stay engaged, and to benefit from flexible work options.

• The Work Bonus Incentivises Work: Eligible pensioners can use the Work Bonus scheme to earn income from employment without it affecting their Age Pension payments as significantly.

• Protection Against Ageism: While legal protections exist, mature-age workers may still encounter informal age discrimination, highlighting the need to know your rights and options.

Australia's stance on mandatory retirement

For most workers in Australia, the concept of a mandatory retirement age is a thing of the past. The Age Discrimination Act 2004 (Cth) makes it unlawful for an employer to terminate someone's employment solely based on their age. This protection extends to all aspects of employment, including recruitment, promotions, and conditions of service. The law aims to ensure that a person's ability to work is judged on merit and their capacity to perform the job's inherent requirements, rather than being limited by an arbitrary number.

Are there any exceptions to the rule?

While the legislation covers the vast majority of the workforce, a few exceptions exist. These typically apply to very specific occupations where age is considered a bona fide occupational requirement or is mandated by other legislation. Examples include:

• Federal Judges: Under Australia's constitution, federal judges are required to retire at age 70.
• Australian Defence Force personnel: Permanent ADF members must retire at age 60, while reservists can serve until 65, though extensions are possible.
• Airline pilots: There may be mandatory retirement ages for safety reasons, which are regulated by specific laws.

However, for everyday professions, including skilled trades, retail, and office jobs, an employer cannot legally force an employee to retire at 70 or any other age. To do so would constitute age discrimination.

Key age-based financial milestones

Although there is no compulsory retirement age, Australian law does specify ages that impact your financial readiness to retire. It's crucial to understand the distinction between your preservation age and the Age Pension age.

• Preservation Age: This is the earliest age you can access your superannuation savings. For anyone born on or after July 1, 1964, the preservation age is 60. You can only access your super at this point if you have also met a 'condition of release,' such as fully retiring or starting a Transition to Retirement (TTR) pension.

• Age Pension Age: This is the eligibility age for the government's Age Pension, which is means-tested. Since 1 July 2023, the Age Pension age has been 67. Eligibility for the Age Pension depends on an individual passing both an income test and an assets test. This provides a vital financial safety net, but it is not a requirement to stop working to receive it.

Factors influencing the decision to work past 70

More Australians are opting to stay in the workforce longer, influenced by various factors. This shift challenges traditional ideas about retirement and offers both benefits and challenges for older workers.

Benefits of working longer

• Financial stability: Working longer allows individuals to continue contributing to and growing their superannuation balance, delaying the need to draw down on savings. This can significantly improve financial security throughout a longer retirement.
• Mental and social engagement: Employment provides routine, social interaction, and mental stimulation, which can have positive effects on overall health and well-being.
• Flexible options: The rise of remote work and a greater acceptance of flexible work arrangements have made it easier for older Australians to remain in the workforce on a part-time or casual basis.

Challenges for older workers

• Age discrimination: Despite legal protections, older workers can still face informal pressure to retire or experience discrimination in recruitment and promotion. The Australian Human Rights Commission has investigated persistent discrimination against mature-age workers.
• Health and physical demands: Some physically demanding jobs become more difficult to perform with age, making continued full-time employment impractical for many.
• Navigating entitlements: Understanding how earning an income affects Centrelink payments like the Age Pension requires careful financial planning. The Work Bonus scheme helps, but pensioners must still monitor their income and assets.

Planning for your retirement timeline

For most Australians, retirement is not a single event dictated by age but a transition that can be carefully planned. To determine your personal retirement timeline, consider your financial resources and desired lifestyle. The Australian government supports older Australians who want to continue working by providing incentives, such as the Work Bonus for eligible pensioners.

Comparison of retirement milestones and considerations

Feature	Preservation Age	Age Pension Age	Continuing to Work Past 70
Purpose	Access your superannuation savings.	Access government Age Pension, subject to means tests.	Maintain income, grow savings, stay engaged.
Age for eligibility	60 (for those born after 1 July 1964).	67 (for those born after 1 January 1957).	No age limit, protected by law against forced retirement.
Key Conditions	Must meet a 'condition of release,' such as retiring, ceasing employment after 60, or turning 65.	Must pass the residency, income, and assets tests.	Depends on your health, job suitability, and preference.
Impact on Income	Provides access to retirement savings for income.	Provides a regular fortnightly government payment.	Earned income may reduce Age Pension payments, but the Work Bonus can offset this.
Flexibility	Allows for full access to super or a transition to retirement income stream.	A supplemental income source, subject to government policy.	Offers potential for gradual reduction in work hours or a change in career path.

Conclusion

The idea that you have to retire at 70 in Australia is a misconception rooted in outdated practices. Federal and state laws largely prohibit mandatory retirement based on age, ensuring that most people have the freedom to work as long as they choose, provided they can meet the inherent requirements of their job. While the government sets Age Pension and superannuation preservation ages, these are not binding retirement deadlines but rather markers for when financial support options become available. The decision to continue working past 70 is increasingly common and is influenced by personal financial needs, a desire for continued engagement, and evolving workplace trends. Older workers should be aware of their rights under the Age Discrimination Act and consider seeking financial advice to make informed choices that align with their personal circumstances.

For more information on employment rights, visit the Australian Human Rights Commission at https://humanrights.gov.au/our-work/age-discrimination.

Frequently Asked Questions

Is it legal for an employer to force me to retire at 70 in Australia?

No, it is illegal for most employers in Australia to force an employee to retire solely because of their age. The federal Age Discrimination Act 2004 protects workers of all ages from discrimination in employment.

What is the official retirement age in Australia?

There is no single 'official' retirement age in Australia. The decision to retire is a personal one. However, there are two key age-related financial milestones: the superannuation preservation age (often 60) and the government's Age Pension age (currently 67).

Can I keep working and receive the Age Pension?

Yes, you can work and receive the Age Pension, but your employment income is assessed under the Centrelink income test. The Work Bonus scheme can help by reducing the amount of your employment income that affects your pension rate.

At what age can I access my superannuation in Australia?

For most Australians born after 1 July 1964, your 'preservation age' is 60. This is the earliest age you can access your super, provided you have also met a condition of release, such as fully retiring.

What happens if my employer pressures me to retire?

If your employer pressures you to retire based on your age, you may be experiencing age discrimination. You can report this to the Australian Human Rights Commission, which can help investigate and resolve such complaints.

Are there any jobs in Australia with a compulsory retirement age?

Yes, but these are very rare and specific. Certain high-level roles, such as federal judges and military personnel, have mandatory retirement ages mandated by law. This does not apply to the vast majority of jobs.

Can I retire and then go back to work later?

Yes, you can. If you cease an employment arrangement after age 60 and access your super, you can later return to work for a new employer. However, any new super contributions will be locked up again until you retire or reach age 65.