Firms 'Need Time To Prepare'

The Confederation of British Industry’s call for more clarity on what the future will hold following the scrapping of the default retirement age (DRA) has been welcomed by an employment expert at Irwin Mitchell.

According to the business organisation, the move will lead to “unintended consequences” which may leave employers facing both uncertainty and the risk of tribunals. It has now called for the end of the DRA to be delayed for a year to allow for guidance on the issue to be prepared.

Fergal Dowling of Irwin Mitchell’s Employment Law team said that while the government has suggested advice will be available from early 2011, it will not give firms time to prepare for the end of the DRA in April.

He explained: “This delay appears to have resulted in some older workers losing their jobs as employers endeavour to retire employees whilst the default retirement provisions are still available.  For example, Longleat has recently retired 27 staff aged 65 and over in a two week period.  Whilst all employees had a retirement age of 65 included in their contracts of employment, many worked beyond that age. 

“It is reported that the compulsory retirements included 18 workers over the age of 70, seven over the age of 75 and two members of staff in their 80s. This certainly looks like a pre-emptive strike and is an approach many employers are likely to follow to avoid the risks of justifying each retirement or taking older employees down a capability route before dismissal.”

The employment expert added that Irwin Mitchell’s team of specialists is now calling on its clients to genuinely consider requests from employees who are keen to work beyond retirement.

He added: “A recent decision in the Employment Tribunal made an award of two years of pay to an employee retired in accordance with the statutory retirement procedures where the employer made it clear to its staff that everyone had to retire at 65 and that there were no exceptions to that policy.

“In the circumstances the Tribunal found that the employer had not properly complied with its duty to consider the employees request to work beyond 65.  This decision has been heavily criticised and is not in any event binding.  However, it is worth taking the extra time to genuinely consider the request before rejecting it out of hand to avoid similar claims.”