Personnel Today
  • Home
    • All PT content
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Learning & training
    • Pay & benefits
    • Recruitment & retention
    • Wellbeing
    • Occupational Health
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • Brightmine
    • Learn more
    • Products
    • Free trial
    • Request a quote
  • Webinars
  • Advertise

Personnel Today

Register
Log in
Personnel Today
  • Home
    • All PT content
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Learning & training
    • Pay & benefits
    • Recruitment & retention
    • Wellbeing
    • Occupational Health
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • Brightmine
    • Learn more
    • Products
    • Free trial
    • Request a quote
  • Webinars
  • Advertise

Pay & benefitsHealth insurance

Weekly dilemma: Ending permanent health insurance cover

by Personnel Today 3 Oct 2006
by Personnel Today 3 Oct 2006

Our staff receive permanent health insurance (PHI) until they are 60 years old. I understand this may no longer be allowed because of age discrimination regulations. The cost will increase if we have to cover staff up to 65 and more for those over 65. We are considering refusing the benefit to staff over 60 due to cost, or even ceasing cover for all staff. Is this legal, and what steps would we need to take?

Since the age discrimination laws came into force two days ago, it is unlawful for employers to cease to provide PHI to employees when they reach a certain age, unless you can objectively justify the differential treatment.

The Department for Trade and Industry stated during the public consultation process that ‘cost alone’ was unlikely to provide sufficient objective justification. There may be so few staff over the age of 60 or 65 that the actual increased cost could, in fact, be reasonably absorbed.

If the insurer will not continue the cover past a certain age, this may be objective justification for ending the benefit. But you should first consider whether self-insurance is a viable option.

A short-term fix might be to refuse to employ beyond the current retirement age. However, the government has committed to review the default retirement age in 2011 and the current default age of 65 is subject to a judicial challenge.

You could remove the benefit for all staff, or reduce the extent of the cover for everyone to absorb the increased cost of extending the cover to staff over a certain age. This would remove the age issues, but be aware that unless the benefit is entirely discretionary, this could lead to claims for breach of contract.

If the benefit is to be limited to certain age groups, you should prepare written impact assessments setting out what has been done to address the issue and why you will be limiting the benefit. If the reason comes down to cost, then the assessment should set out exactly why the cost could not be realistically absorbed by referencing your company’s accounts.

You should also keep the assessment under regular review, at least annually, as business circumstances and the range of insurance products available will change over time.

Deborah Hely, partner, employment, Beachcroft

Sign up to our weekly round-up of HR news and guidance

Receive the Personnel Today Direct e-newsletter every Wednesday

OptOut
This field is for validation purposes and should be left unchanged.

Each week we ask the experts to answer your legal dilemmas. If you have a legal question or dilemma, e-mail [email protected]

 

Personnel Today

Personnel Today articles are written by an expert team of award-winning journalists who have been covering HR and L&D for many years. Some of our content is attributed to "Personnel Today" for a number of reasons, including: when numerous authors are associated with writing or editing a piece; or when the author is unknown (particularly for older articles).

previous post
Editor’s comment
next post
Talk Talk firm set to double its workforce

You may also like

Jobs market continuing to stagnate, says official data

16 Sep 2025

Barclays Bank boss warns Reeves over public sector...

12 Sep 2025

MPs probe Asda financial links with workplace lender

12 Sep 2025

Workplace health benefits need to be simplified

9 Sep 2025

Two in three NHS staff say pay is...

9 Sep 2025

Pay awards feeling tightest squeeze since December 2021

8 Sep 2025

Director with cancer treated unfairly over pay, rules...

5 Sep 2025

Revolut employees to receive share sale payout

2 Sep 2025

City law firm freezes junior lawyers’ pay to...

28 Aug 2025

Employee Benefits Live 2025 conference programme unveiled

21 Aug 2025

  • Workplace health benefits need to be simplified SPONSORED | Long-term sickness...Read more
  • Work smart – stay well: Avoid unnecessary pain with centred ergonomics SPONSORED | If you often notice...Read more
  • Elevate your L&D strategy at the World of Learning 2025 SPONSORED | This October...Read more
  • How to employ a global workforce from the UK (webinar) WEBINAR | With an unpredictable...Read more

Personnel Today Jobs
 

Search Jobs

PERSONNEL TODAY

About us
Contact us
Browse all HR topics
Email newsletters
Content feeds
Cookies policy
Privacy policy
Terms and conditions

JOBS

Personnel Today Jobs
Post a job
Why advertise with us?

EVENTS & PRODUCTS

The Personnel Today Awards
The RAD Awards
Employee Benefits Live
Employee Benefits
Forum for Expatriate Management
Whatmedia

ADVERTISING & PR

Advertising opportunities
Features list 2025

  • Facebook
  • Twitter
  • Instagram
  • Linkedin


© 2011 - 2025 DVV Media International Ltd

Personnel Today
  • Home
    • All PT content
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Learning & training
    • Pay & benefits
    • Recruitment & retention
    • Wellbeing
    • Occupational Health
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • Brightmine
    • Learn more
    • Products
    • Free trial
    • Request a quote
  • Webinars
  • Advertise