Forced retirement not age discrimination-EU court

BRUSSELS, Oct 16 (Reuters) European Union countries can force people to retire at 65 to make room for younger workers, without violating a European Union directive barring age discrimination, the EU's highest court ruled today.

The European Court of Justice in Luxembourg ruled in the case of a Spanish manager with a retailer who was forced to retire in 2005 because he reached the age of 65.

The court said it ''does not appear unreasonable'' for a country to require compulsory retirement at a particular age.

Forced retirement ''may be appropriate and necessary'' to promote ''full employment by facilitating access to the labour market,'' the court said.

Spain had argued it was lawful for union agreements to impose a retirement age, such as 65.

The Spanish man, Felix Palacios de la Villa, challenged that provision as a violation of an EU directive which prohibits discrimination based on age and other factors such as disability, religion, belief and sexual orientation.

The directive bars ''direct or indirect discrimination based on ... age'' requiring policies that ''pay particular attention to supporting older workers, in order to increase their participation in the labour force.'' It says discrimination based on age or other factors can undermine EU objectives, such as high employment.

Europe has an ageing population and a relatively low birth rate compared with some other areas of the world. In addition, Europeans are staying healthy longer than in years past.

There has been much discussion of raising the retirement age in some countries in order to take pressure off pension funds.

REUTERS RSA RAI2332