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No Need for Employer Panic Over Abolition of Default Retirement Age- 14/01/2011
Employers should not panic about the Government’s abolition of the default retirement age (DRA), according to a leading Wolverhampton employment lawyer.
Peter Collins, Partner in the Employment Department at Wolverhampton law firm FBC Manby Bowdler LLP, says although phasing out of the default retirement age will begin this April, with total abolition on 1 October, employers can still use the DRA regulations before 1 April to ensure that employees retire compulsorily at age 65.
He says: “During the transitional period, retirements that were already in motion can continue through to completion, provided that: a notification of retirement is issued by the employer prior to 6 April 2011; the date of retirement falls before 1 October 2011; and the requirements of the statutory retirement procedure are met. This means that employers still have time to react to impending retirements and then to consider how they will deal with aging workers in the future.
“From April onwards, the government considers that the dismissal of older workers should be managed either by discussion or by formal performance management procedures, but it is vital to take legal advice and put formal policies in place so that there is no possibility of employers facing an Employment Tribunal,” advises Mr Collins.
One piece of good news for employers is that an exemption is expected to be introduced for group risk insured benefits (e.g. medical insurance), where there was a concern that employers would stop offering such benefits if it became too expensive to pay the premiums due to an ageing workforce.
Mr Collins says: “In broad terms, it will not be unlawful to discriminate on grounds of age when providing such benefits, but we will need to see the draft legislation to ensure that this is actually the case.”
With 35 partners, FBC Manby Bowdler is one of the largest law firms in the West Midlands. The firm has offices in Wolverhampton, Willenhall, Telford, Shrewsbury and Bridgnorth.