European ministers are threatening to bring in laws banning age discrimination, which would put pressure on UK firms to keep older people working longer.
It is rumoured that the Council of Ministers will ratify the proposals - which come under the EU Employment Directive - in the Autumn.
Sara Leslie, human rights specialist for legal firm Irwin Mitchell, warned companies to be wary of the new proposals discussed in Brussels.
She said, "I think employers will be caught out by laws on age discrimination because there is quite a lot of this kind of discrimination out there.
"In some sectors firms rarely keep people past 50 because it costs less to get rid of them and replace them with younger people. The age discrimination laws will cause a lot of problems for companies using this policy."
Robbie Gilbert, chief executive of the Employers' Forum on Statute and Practice, felt that the Council of Ministers would be unlikely to uphold the proposals as it would take an unanimous decision by the council.
He said it was more likely that the Government would bring in age discrimination laws after the next election. The Government introduced a voluntary code of practice on age discrimination in June last year.
"Were these laws to come in, they would cause difficulties for companies with early retirement policies. The method of redress would be through the existing tribunal system."
A Cabinet Office report has recommended ways in which the Government can help improve participation from the over-50s who have withdrawn from work.
Winning the Generation Game from the Performance and Innovation Unit was published in April 2000 and rejects the notion that older people should give way to "young blood" (Personnel Today, 2 May).