| Results of Consultation on Removing the Default Retirement Age |
End of Consultation: Removal of the default retirement ageBackgroundThose of you who are regular readers of these updates will be aware of the changes to the default retirement age coming into force this year. The Government had always allegedly made the proposals subject to ‘consultation’ before confirming that they would become law and (to the surprise of no-one) the consultation confirmed that indeed the abolition of the default retirement age will go ahead this year as planned. See previous updates for details on the same. Note that at the time of going to press, there are rumours from some sources that the transitional provisions may allow for retirements until April 2012 and not 30th September 2011, but this is by no means clear yet, as the Government may stick to the original plan. You should seek our advice if this affects you. By fundamentally ignoring almost all of the concerns expressed by employers during the consultation process, the Government’s response to the consultation paper says it considers the dismissal of older workers should be managed either by discussion or by formal performance management procedures. There is going to be one welcome development for employers and that is the proposed exemption for group risk insured benefits (e.g. medical insurance). Here there was a concern that employers would stop offering such benefits if it became too expensive to pay the premiums due to the age of the workforce. It is presently proposed that it will not be unlawful to discriminate on the grounds of age when providing such benefits. Details will presumably follow when the draft legislation is published in due course. The Government’s response to the consultation paper nevertheless makes interesting reading and it can be found on the BIS website. On that same page is a link to the ACAS website and ACAS have published some guidance on how employers are supposed to operate without the default retirement age. One area on which we expect further guidance is how employers are to sensibly discuss retirement with employees reaching 60/65/70 etc, without being held to be discriminatory or being subject to a claim for age discrimination. It is suggested that further guidance will clarify this and an employer will be able to raise such issues without the fear of claims, simply as a result of discussing the same. |