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Network Journal 2005 Issue 3 |
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Is time running out for age discrimination?
October 1 2006 is expected to see the introduction of legislation which will outlaw age discrimination.
At the moment the Government is consulting business and unions on its draft regulations which are likely to form the basis of the forthcoming law.
On this page we look briefly at some of the proposals and ask - is this the beginning of the end for age discrimination?
- The regulations will aim to ban age discrimination on recruitment, promotion and training. However upper age limits may continue to be lawful where the employer can objectively justify them.
- The 'default' retirement age of 65 is likely to remain. Employees will be able to agree to retire earlier or later than this but the regulations may allow employers to set the retirement age at 65 therefore allowing them to impose compulsory retirement.
- Employers may be able to justify retirement and retirement ages below 65 if they can satisfy the general test of 'objective justification'.
- A new legal duty for employers to consider an employee's request to continue working beyond retirement is expected. However, it is unlikely that an employee whose request is turned down will have any legal redress so long as it has been given serious consideration.
- Employers should give written notice to employees of at least six months in advance of their retirement date to allow people to plan for their retirement.
- Younger workers will see little benefit from the regulations as Government look set to maintain the national minimum wage age bands allowing a lower rate for workers aged under 22.
- The upper age limit for bringing a claim of unfair dismissal may be abolished.
- The law is likely to remove the lower and upper age limits on entitlement to redundancy payments although employees will still need two years' service to qualify. Payments will still be calculated based on length of service, but will no longer vary according to age. The new calculation method has yet to be decided.
- The new legislation is unlikely to affect the age at which people can claim their state pension.
- As far as occupational pension schemes are concerned, new tax simplification changes due from April next year will allow employers the option of offering employees approaching retirement the choice of taking their pension benefits from the occupational pension scheme AND continuing to work (maybe on reduced or part-time hours) in the same job.
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