Age Discrimination - October 2006

When the Age Discrimination Regulations become law in October 2006 they will apply to recruitment and employees starting employment, employees in employment and employees whose employment is being terminated. In this Newsletter we look at the effect these regulations will have on redundancies and retirements.

Approximately 10% of the calls we receive on the Support Line are related to redundancy. Under the new regulations the upper age limit on statutory redundancy pay will be removed and service for employees under 18 years of age will no longer be ignored. The 2 year qualifying length of service and the 20 year service cut off will remain. It is expected but not yet confirmed that employees of all ages will receive 1 weeks redundancy pay for each qualifying year of service. Great care will have to be taken when selecting employees for redundancy to ensure that the selection criterion does not discriminate on the grounds of an employee’s age. You should always take advice from the Support Line on each stage when implementing redundancies. We expect a large increase in the number of calls regarding retirement. Current government proposals are to increase the age at which the state pension is paid to employees up to the age of 68 but this will not be implemented until 2050 and should not concern us at the present time. The Age Discrimination Regulations will provide an exception from the unfair dismissal rules that will allow employers to retire employees at or above 65 provided that in all cases it is a genuine retirement and they comply with the correct procedures. Employers with a retirement age of 65 or with no retirement age will be able to continue to retire employees at 65. Employers with retirement ages above 65 will be able to retire employees at their set retirement age.
Employers who have a retirement age below 65 will have to increase it to 65 or to objectively justify it.

It is only where an employee does not wish to retire that retirement constitutes a dismissal. In order for that dismissal to be a fair one, it is important to follow all the correct procedures. The retirement must be at age 65 or at the employer’s retirement age. The employer should inform the employee of the retirement date at least 6 months but not more than 12 months in advance, notify them of their right to request to work beyond that date and the employers duty to consider this request. The employee’s request must be made between 12  months and 6 weeks prior to their retirement date. The employer must then meet with the employee and give a decision within 2 weeks. The employee will then have 2 weeks to appeal the decision.