This site uses cookies. By continuing to browse the site you are agreeing to our use of cookies. Find out more here.
X
MM+cover+small+180914

Head to Head: Scrapping the default retirement age

  • Print
  • Comments (1)

Has the Government struck the right balance in its approach to the removal of the default retirement age? The CBI and Age UK go head to head.

Neil-Carberry.jpg

Neil Carberry, Head of employment and pensions policy, the CBI

Earlier this month, the Government announced its decision to abolish the default retirement age - currently 65 - in three month’s time. This was a move opposed by the CBI and other business groups.

In such a debate, it is easy to cast those who argue that a default retirement age is valuable as dinosaurs - refusing to accept the need for people to work longer and that people will want to do so.

Nothing could be further from the truth. In fact, the CBI has been at the forefront of supporting longer working lives through the right to request working on and raising the state pension age. And yes, raising the DRA over time, in line with state pension age, to 68 or even 70 by the 2030s would have been a wise move.

Businesses know that they will employ more older workers in future and that will require changes in how they do some things.

So, why the problem? At its heart, the DRA gives employers and employees a framework for planning retirement - a time to have a safe, legal conversation about working on, a process to follow to set that arrangement up. In short, firms can manage older workers with confidence and be free of the fear of a legal claim.

Incidentally, one of the things that has been missed in the abolition of this system is just how successful this approach was. The vast majority of requests were accepted and the participation of workers over SPA rose substantially over the period.

Businesses know that they will employ more older workers in future and that will require changes in how they do some things

But that system is gone and in its place we have a vacuum. Uncertainty about what can be said, uncertainty about whether a retirement age can pass the complex test of “objective justification” and, most of all, a requirement to use performance-based dismissal processes to remove workers who can no longer do the job.

All this brings high cost in management time, the risk of complex legal claims and a great deal of upset to the employee involved. The problem we feel is a practical one - in getting rid of the DRA, the Government needed to come up with a workable replacement package and it has not yet done that.

There is an opportunity to address this over coming months, however, mainly through the upcoming employment law review. A package of reforms which simplified performance-based dismissal, resolved employment tribunal claims quicker and set out clearly that employers can discuss future plans with employees would go a long way. Let’s hope the Government is listening. After all, the Government and the CBI share a belief that it is employment in the private sector that will drive us out of recession. Creating the conditions for that employment easier will be a win-win.

 

Michelle-Mitchell.jpg

Michelle Mitchell, Charity director, Age UK

Two separate announcements have given some hope thatthe tide is turning in the battle against ageism. The Employment Tribunal established that broadcast journalist Miriam O’Reilly was discriminated against by the BBC because of her age, prompting the corporation to issue a full apology and a promise to do better in future. Two days later, the Government finally confirmed that forced retirement will end this year, in all but exceptional circumstances.

The mindset behind ageist attitudes in the TV industry is not dissimilar to that underpinning the principle of the default retirement age.

Setting an official age at which people can be forced to retire sends a damaging signal to society that goes beyond the personal insecurity forced on the hundreds of thousands the law strips of employment rights.

By stamping a use-by date on people’s careers, it reinforces the idea that there is an age threshold at which people’s contribution as workers is no longer of value and they are ready for the scrapheap.

The truth is that there is no use-by date on talent and skills and no age limit to what people can achieve. Nearly a million people aged 65-plus are still in employment and many more are planning to stay on in work past this age when their turn comes. Dame Judi Dench was nominated for an Oscar at the age of 72, Michelangelo was 74 when appointed as chief architect of Saint Peter’s Basilica, and Winston Churchill celebrated VE day at 70. Writing people off because of their age is no more justifiable than doing it in the name of race, sex or disability and yet ageism is still a more “respectable” form of discrimination in our society.

Setting an official age at which people can be forced to retire sends a damaging signal to society

The outcome of the BBC case and the Government’s decision to scrap the default retirement age are landmarks but there is still a long road ahead if 21st century Britain is to be free from age-based prejudice.

As we grow older, we are still penalised in all walks of life, when refused insurance cover, turned down for a job or denied the healthcare that most suits our needs.

Change will come by winning hearts and minds but events have shown that the law can overturn injustice and shine a spotlight on hidden discrimination. The Government must press on with plans for an outright ban of age discrimination in the provision of all goods, facilities and services.

  • Print
  • Comments (1)

Daily Email Updates
If you enjoyed this article, sign up to receive the latest news and analysis from Money Marketing.

The Money Marketing CPD Centre
Build your annual CPD - you can log and plan your CPD hours for free with The Money Marketing CPD Centre.

Taxbriefs Advantage
Advantage is a digital reference source giving unbiased, independent, answers to your technical queries. Subscribe to Taxbriefs Advantage.

Readers' comments (1)

  • A mixed and confusing statement if ever I heard one.

    Unsuitable or offensive? Report this comment

Have your sayEdit my profile/screen name

You must sign in to make a comment

Fund Data

Editor's Pick



Poll

Do you think the industry is ready to deliver Budget guidance?

Job of the week

Latest jobs

View all jobs

Most recent comments

View more comments