The new measures – published in draft today – are the final
stage of implementing the European Employment Directive. With the
approval of Parliament, the regulations are due to come into force
on 1st October 2006.
The draft regulations (which will not affect the age at which
people can claim their state pension):
- prohibit unjustified age discrimination in employment and
vocational training;
- require employers who set their retirement age below the
default age of 65 to justify or change it;
- introduce a new duty on employers to consider an employee’s
request to continue working beyond retirement;
- require employers to inform employees in writing, and at least
6 months in advance, of their intended retirement date. This
will allow people to plan for their retirement;
- remove the upper age limit for unfair dismissal and redundancy
rights, giving older workers the same rights to claim unfair
dismissal or receive a redundancy payment as younger workers,
unless there is a genuine retirement; and
- include provisions relating to service related benefits and
occupational pensions.
The regulations also remove the age limits for Statutory Sick
Pay, Statutory Maternity Pay, Statutory Adoption Pay and Statutory
Paternity Pay.
The Department of Trade and Industry (DTI) said it will
also be taking steps to gauge stakeholder opinion on changes to the
method of calculation of statutory redundancy payments.
Mr Johnson said: "Individuals should have the choice to carry on
working if they want to. This is not about forcing people to work
longer, it is about freedom to choose."
He added that people need to be able to plan for their future
and retirement should not come as an unexpected surprise. "The duty
for employers to give at least six months notice will help
individuals make informed decisions about retiring," he said.
Many rules in existing occupational pension schemes are
age-based, but the new regulations will effectively exempt most
age-related rules so that pension provision will not be jeopardised
and necessary pension operations can continue unaffected. As far as
possible exemptions will also be made for length of service pay and
non-pay benefits, according to the DTI.
The DTI is consulting on the practical application of the draft
regulations, to ensure they are effective and workable.
