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Duty to consider working beyond retirement
There are a number of detailed steps involved in the "duty to consider" process. In summary:
- The employee's request must be in writing
- The employer must hold a meeting to consider the request (unless it is not reasonably practicable to do so)
- The employer must then notify the employee in a written, dated notice of his decision as soon as reasonably practicable after the meeting
- If the request is refused, an employee can appeal against that refusal
- If the request is accepted, employment can continue indefinitely, for a stated period or until a specified date.
Surprisingly, the employer does not have to give reasons for his refusal of the request and indeed does not even have to consider the request fairly or in good faith. As a result, it is likely that many employers will enforce a blanket policy of refusing all such requests. If this proves to be the case, it somewhat undermines the underlying reasoning behind the legislation of encouraging employees to work longer in order to bridge the pensions gap and tackle the problem of an ageing population.
Where an employer fails to follow the "duty to consider" process, what would otherwise have been a retirement will become an automatically unfair dismissal.
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Removal of upper age limit for unfair dismissal
Currently employees over the age of 65 are ineligible to claim unfair dismissal. Under the new regulations this restriction will be removed so that older employees will get the same rights to claim unfair dismissal as younger employees. Interestingly, however, the requirement to have at least one year's service, arguably a form of indirect discrimination against younger workers, will remain. Likewise, basic awards in the Employment Tribunal will continue to be calculated based on age related bands, although there will no longer be tapering compensation between ages 64 and 65. |
Redundancy rights
Similarly, although two year's service will still be required to gain entitlement to a redundancy payment and age related bands will still be used to set the level of the redundancy payment, under the regulations service under the age of 18 and over the age of 65 will now count towards the calculation of the payment. |
Practical steps
Shrewd employers will use the next three months to prepare themselves for the new legislation. In addition to those steps we suggested last month employers may wish to:
- Change their normal retirement age if this is below 65 or consider how they may go about justifying the retention of a lower age. If the latter option is chosen, care should be taken to thoroughly document the thought process and any evidence taken into account, e.g.. recruitment figures, should be retained
- Begin diarising the prospective retirement dates of employees to ensure that notices are sent at the appropriate times. Extreme care should be taken to consider the transitional provisions for those retirements scheduled to take place between 1st October 2006 and 1st April 2007.
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Overview
The effect of this legislation is likely to be widespread - after all, unlike other strands of discrimination where only certain employees qualify for protection, each and every employee has an age. It is relatively easy to be accused of age discrimination and it is highly probable that many Tribunal claims post 1" October 2006 will include an age discrimination element, at least until it becomes clearer as to exactly which forms of ageism will be permitted under the law. Many companies are likely to fall foul of the legislation unwittingly and it is difficult, at this stage, to asses exactly what the impact will be. However, one thing is easy to predict. It will be some time before the dust begins to settle - will employment law ever be the same again?
If you would like any more information about this, or related employment matters, please do not hesitate to contact Adrian Berkeley on 0161 371 0011.
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