Small firms unprepared for change to retirement age
Large numbers of smaller employers are not ready for a major change in employment law which comes into effect as from October.
The default retirement age of 65 will finally be scrapped as from 1 October this year, a measure that has been phased in since April.
This means that employers will no longer be able to force workers to leave their jobs once they hit 65 simply on the grounds of age alone.
However, a survey carried out by Employment Law Advisory Services (ELAS) revealed that a significant proportion of the SMEs polled were unaware of the legal implications that the move will involve.
Of those employers that offer private health cover, more than half (57 per cent) did not realise that the cost of provision for such benefits would rise markedly for employees aged over 65.
Peter Mooney, ELAS head of employment law, said: “Most businesses we speak to are now aware that they cannot force staff to retire due to age alone, but it seems many businesses haven’t actually thought through how the new law will affect them in practice.
“Expensive healthcare benefits is just one example of how employing older workers will affect businesses – risk assessments, access requirements and adjustments for disability may also need revision as workforces grow older.”