16 March 2006

Age Discrimination Regulations published

On 9th March the UK government published the final draft of these Regulations, which constitute one of the most important pieces of employment legislation since the 1970s and comes into effect on 1st October this year. This legislation will apply to employees of all ages and will: • Outlaw discrimination on the grounds of age • Outlaw victimisation and harassment on the grounds of age This will apply to all areas of the employment relationship from recruitment through to retirement There will be a defence of “justification” ie that the discrimination was a proportionate means of achieving a legitimate aim. However, the Government has removed all guidance on what constitutes a successful justification defence, and it has already made clear that it expects a high standard of proof necessary. In addition The age cap for claiming Unfair Dismissal has been removed, so those over 65 will be able to make a claim. A retirement age of 65 has been set. Any dismissal for retirement at an earlier age will be unlawful unless justified and retirement at 65 will only be lawful if the correct procedure including a ‘duty to consider a request to continue working’ has been followed Transitional provisions have been put in place for all those due to retire between 1st October 2006 and 1st April 2007. Anne Copley, BPIF Head of Legal, says “The transitional provisions are horribly complicated, and after lying down in a darkened room for the afternoon the best advice is that employers should be consulting now with all employees in this retirement bracket, and give them written notice of the exact date on which they are expected to retire. Follow that up on 1st October this year with a letter notifying them of their right to request the employer to reconsider. It is very important that you diarise that date and act immediately the Act comes into force, otherwise you may incur penalties or have to put off the retirement date whilst going through the motions” Benefits Any benefits that depend on length of service could be discriminatory, in that those with longer service will probably be older. The Regulations allow such benefits if the relevant length of service is 5 years or less. For anything more than that the employer must show that the length of service requirement ‘fulfils a business need’. Anne Copley continues “The Regulations give as examples the encouragement of loyalty or motivation or rewarding the experience of some or all workers. This is actually a concession from the original draft Regulations and makes it a bit easier to justify such benefits.” Ill-health benefits Provision of income protection, permanent health insurance, sick pay schemes and the like is often age-related. The Regulations originally excepted work-related invalidity benefit schemes from the Act. However in their final form that exception has been removed. “This means that any ill-health scheme with a cut-off age is likely to be discriminatory” says Anne Copley “This will be very costly to employers who face much higher premiums in order to ensure their older workers are covered.” “All employers need to carry out a full audit of all schemes and policies and consider whether they can justify them in their current form” she continues “If not, then they will need to be brought in line with the legislation by October. I suggest everyone takes all the professional advice they can get in order to help them through this major culture change”