Businesses not prepared for new age rules

Proposed changes to employment regulations that would prevent employers setting retirement ages for staff and remove the upper age limit for statutory redundancy pay are likely to come as a big surprise to British businesses, according to new research published today (Thursday 29th
January) by Manpower, the leading recruiter of permanent, temporary and contract workforces.

The research* found that 61% of employers were either unaware of or doing nothing to prepare for the impact of the legislation, the European íEqual Treatment Framework Directiveí, on which the UK Government is currently consulting with a view to bringing new rules on age discrimination into force in 2006. The Department for Trade and Industry has completed a consultation on the draft legislation and is planning further consultation in the first half of this year.

Ruth Hounslow, Head of Public Affairs at Manpower, says: Manpower welcomes moves to increase access to employment for all, regardless of age or other barrier, and so widen the pool of labour for our customers. These new measures to prevent employers discriminating on the grounds of age in recruitment, reward, redundancy and retirement will be in force in the UK in a little over two years time. Employers need to know whatís going to change and to start preparing now. At Manpower, we are already working with our national and local customers to ensure a smooth transition to the new regulations, and maximum opportunities for our employees.

Other key issues for UK business under the proposals include the extension of eligibility to claim unfair dismissal to all employees regardless of age, and the outlawing of any recruitment, selection or promotion on the basis of age unless the employer can justify doing so.

Smaller firms in particular are likely to be surprised by the rule change: 77% of firms with fewer than 10 employees and 65% of firms with 10-49 employees, said they were unaware of or unprepared for the legislation.

Despite, or perhaps because of, this lack of awareness of the proposed changes, 78% of all employers said they were very confident that they do not discriminate with regards to age factors. However, over half (53%) of all firms who provide health insurance to staff felt that any increase or removal of the retirement age would result in greater costs to their business in the form of higher premiums.

The utilities sector is best prepared for the legislation with 53% of electricity, gas and water suppliers already preparing for the change, while the biggest shock waves are likely to be felt in Wales where fewer than one in five (18%) of organisations saying they are preparing for the new
legislation.