Firms urged to check share plans: age discrimination

Organisations should start checking staff share plans to make sure they aren’t discriminatory under the proposed age laws, due to come into force this October.

Elizabeth Graves, a pensions and benefits expert at law firm Freshfields Bruckhaus Deringer, has warned that some schemes may conflict with the Employment Equality (Age) Regulations that will be enacted on 1 October 2006.

Early planning is vital, because any changes that need to be made may require the approval of shareholders.

Graves urged employers to maintain a written record of any objections to specific features of schemes that may discriminate on the grounds of age, to help fend off potential claims in the future.

“Many share plan rules exclude employees from participation until they have completed a period of qualifying service. An exclusion rule may be unlawful if it is caught by the definition of indirect discrimination in the regulations,” she said.

The Office for National Statistics has predicted that the number of employees working beyond the current retirement age will rise by a third over the next 14 years.

By the year 2020, it expects the number of over-65s in the workplace to grow from 582,000 to about 775,000.

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