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Lawyer says employers could face more tribunals with changes to retirement age

 

Article date:  18/08/2010

An employment lawyer is warning businesses that they could face the risk of increased age discrimination claims in the near future.

Nick Vernon of Midlands law firm Higgs & Sons, believes that the proposed changes in the law on the default retirement age recently announced will lead to more employment tribunals: The Government has recently published a consultation document setting out its proposals to phase out the current default retirement age of 65 in October 2011.

Nick says "In a statement the Department for Business said they estimated that the changes would lead to a reduction of between 200 and 400 employment tribunals every year. However it's our belief that the exact opposite may occur because employers in the region will be forced to prove whether or not older employees are capable of continuing in their current role at 65. We believe this will lead to an increase in older employees taking their employers to employment tribunals claiming age discrimination."

A six-month transition period from the existing regulations begins in April 2011.

Nick continues: "It's estimated that the Exchequer could gain an extra £79 million in tax revenues in the first year alone once the default age is scrapped.

"The Government has also claimed that the changes will save employers money, but it appears to be underestimating how much businesses will spend in costly tribunals taken by disgruntled workers who are classed as incapable of working in their current role once they pass 65.

"We strongly suggest that employers take legal advice before making any changes to existing employment contracts."

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