The CBI has broadly welcomed the government’s draft regulations on age discrimination, although it raised concerns about the failure to exempt all length-of-service benefits from the proposed laws.
The new rights, which will include a default – but not mandatory – retirement age of 65, will be viewed by companies as a workable and common sense approach, the employers’ group said.
The duty to consider requests to postpone retirement will make a real difference to those employees who want to carry on working, as well as to companies who need their skills, it said.
Following representations from the CBI, a clear process will exist for companies to retire workers over the default retirement age without fear of redundancy or unfair dismissal claims – which, it said, would otherwise have had the perverse effect of discouraging firms from keeping staff on.
John Cridland, CBI deputy director general, said: “In a tight labour market, employers want to retain skilled and experienced older staff who are keen to carry on working. The latest drafting of this landmark legislation for employees will reassure businesses, because it takes account of their need to plan and operate effectively.
“The new rules set out a clear framework for companies and their employees to follow when planning for retirement.”
But the CBI still has concerns about the DTI’s failure to exempt all length-of-service benefits from the draft regulations, Cridland said.
“Companies that currently reward long-serving employees through enhanced sick pay and holiday allowances could risk age discrimination claims from younger employees who have been with the firm for less time,” he said. “In these circumstances, firms might be forced to withdraw this kind of benefit.”