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AGE
DISCRIMINATION
The Age Discrimination Regulations are due to come into force
on 1 October 2006. These new Regulations cover employment and
vocational training and includes access to help and guidance,
recruitment, promotion, development, termination, perks and
pay. The regulations cover people of all ages, both old and
young.
All employers, providers of vocational training, trade unions,
professional associations, employer organisations and trustees,
and managers of occupational pension schemes will have new
obligations to consider under the Regulations. However, goods,
facilities and services are not covered.
A key development is the removal of the upper age limits for
unfair dismissal and redundancy claims. The Regulations will
introduce a national default retirement age of 65 which will
make compulsory retirement below age 65 unlawful (unless objectively
justified). This is due to be reviewed in 2011. Under the Regulations
all employees will have the ‘right to request’ to
work beyond the default retirement age of 65 or any other retirement
age set by the company and all employers will have a ‘duty
to consider’ requests from employees to work beyond 65.
Occupational pensions are covered by the Regulations, as are
employer contributions to personal pensions. However, the regulations
generally allow pension schemes to work as they do now. The
regulations do not affect state pensions.
Who does the law cover?
The Regulations will cover:
- all workers including
self employed, contract workers, office holders, the police
and members of
trade organisations
- people who apply for work and, in some
instances, people who have left work
- people taking part
in or applying for employment related vocational training
including all courses at Further Education and
Higher Education institutions.
The Regulations do not cover members of the regular armed
forces, full-time and part-time reservists, or unpaid volunteers.
What does vocational training cover?
Vocational training covers all forms of training and retraining
courses, practical work experience and guidance that contributes
to employability, training provided by employers or private
and voluntary sector providers, vocational training provided
by further and higher education institutions and adult education
programmes.
What do the regulations cover?
The Regulations cover direct and indirect discrimination,
harassment and victimisation. Employers can (and no doubt extensively
will) be held responsible for the actions of its employees
in all cases. It is therefore imperative that appropriate training
of key members of management is introduced as early as possible
to ensure employers are not overtly exposed through the vicarious
actions of its employees.
Are there any circumstances when treatment on grounds of age
will be lawful?
As with Sex and Race Discrimination exemptions will be allowed
on the basis of a Genuine Occupational Requirement (GOR) provided
that there is an objective justification. However, both are
likely to be difficult to prove. The 'test of objective justification',
means employers will have to show with a sufficient degree
of evidence that are pursuing a legitimate aim and that it
is an appropriate and proportionately necessary means of achieving
that aim.
However, the legislation will protect individuals or companies
who are forced to discriminate on age grounds in order to comply
with other superceding legislation, for example, bar staff
serving alcohol must be at least 18.
My employees’ pay and benefits
vary according to length of service. Will this become unlawful?
Benefits based on a length of service requirement of 5 years
or less, the ‘5 year exemption’, will be exempted
and will be able to continue. Thus any benefit which requires
the successful completion of a probationary period, assuming
that the probationary period is less than 5 years(!), will
remain lawful. However after the 5-year exemption, the burden
will be on employers to show that there will be an advantage
from rewarding loyalty, encouraging the motivation or recognising
the experience of workers by awarding benefits purely on the
basis of length of service.
How does the legislation impact on the National Minimum Wage?
Employers will continue to be able to follow and rely on the
age bands and minimum wage levels used in the national minimum
wage legislation.
What should I know about the default retirement age?
The default retirement age will be set at 65 for men and women.
This will mean that mandatory retirement before that age will
be unlawful unless a lower age can be exceptionally and objectively
justified. It does not mean that employers need to set a retirement
age at 65 either. It is open to employers to operate with no
retirement age at all, or set a retirement age of 65 or higher.
However, given that the upper limit for Unfair Dismissal claims
is to be removed it seems sensible that employers should determine
the appropriate retirement age and formally clarify it in the
contract of employment.
However, this value of this exercise is subject to the rule
that all employees will have the 'right to request' to work
beyond any retirement age. Furthermore, employers will have
new time-bound responsibilities to inform employees of their
'right to request' and they will have a 'duty to consider'
all such applications. It is assumed that this will operate
on a similar basis to the relevantly recent right to request
Flexible Working. However, where an extension of work is agreed,
the 'right to request' and 'duty to consider' will remain in
place when retirement is next considered.
What will the new regulations say about occupational pension
schemes?
It is difficulty to say. What is clear is that the provisions
of Occupational pension schemes are covered by the Regulations
(although the draft legislation allows occupational pension
schemes in general to work as they do at present).
However, personal pensions not provided by the employer (except
the employer’s own contribution) are not covered by the
draft regulations.
It does appear that employers will be able to provide different
pension schemes to employees of different ages or with different
lengths of service and employers will be entitled to use minimum
and maximum ages for admission to pension schemes and for the
payment of pensions.
What should I do now?
It is essential that employers familiarise themselves and
their staff, especially management and those involved in the
recruitment process, with the terms and provisions of the new
Regulations. It is also essential that employers review their
employment policies and procedures.
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