The cost of complying with the pension aspects of the age discrimination laws, which come into force today (1 December), could be as high as £1m per company.
Research, by law firm Eversheds, reveals that half of businesses are anticipating a significant increase in costs, including training, internal management and administration, to meet the requirements of the new legislation.
The research, which canvassed the views of employers and trustees at more than 100 major UK organisations, also shows that one in 10 businesses have not yet considered the potential impact of the new regulations on their pension scheme.
Eighty five per cent of businesses are calling for an implementation period to allow sufficient time to prepare. The government has so far ignored such calls.
More than two-thirds of organisations say they need at least six months to be fully compliant. According to the respondents, the main areas affected by the regulations are late retirement, flexible retirement and service-related benefits.
Esther White, pensions law expert at Eversheds, said: “It’s not surprising that businesses aren’t ready for the new laws, given the fact that they have had just 14 full working days to prepare.
“However, it is a little worrying to find that as many as one in 10 haven’t even started to think about the impact of the new laws. This could leave many organisations exposed to the risk of an age discrimination claim.”
The research also revealed significant frustration among businesses concerning the way the government handled the implementation of the regulations. More than 90% of those questioned said they were dissatisfied with the way the process had been managed.
