BONALLACK & BISHOP – SOLICITORS IN SALISBURY –  PRESS RELEASE 
6 April 2011

Business Fears New Retirement Rules

According to a recent poll carried out by national employment law firm Irwin Mitchell, 57% of businesses surveyed believed that the abolition of the default retirement age (DRA), which came into force on April 6, is likely to result in an increase in both employment tribunal age discrimination and unfair dismissal claims.

59% of the 141 UK businesses surveyed felt that there had been an insufficient explanation of these changes, with almost half of those surveyed believing that the government has rushed through the legislation too quickly. Just 19% felt the new rules would benefit their business.

Nigel Mills, employment solicitor with Salisbury law firm Bonallack and Bishop, commented, “With effect from 6 April 2011 employers will no longer be able to issue notification of retirement to employees who are approaching their 65th birthday. In effect the compulsory retirement of employees when they reach a certain age is abolished, unless the employer can objectively justify it, which will be difficult. The new legislation will mean that all employers are going to need to take particular care when dealing with those aged 65 or over and tread very carefully when looking to dismiss them – or risk facing an unfair dismissal compensation and age discrimination claim before an Employment Tribunal.

“Businesses have become increasingly worried in the last 2 years about the introduction of yet further employment regulations and the accompanying risk of a trip to an Employment Tribunal – especially in light of both the current economic climate and the 2010 Employment Tribunal claim statistics showing an significant year on year increase of 56%.

Tim Bishop, Bonallack and Bishop’s senior partner commented, “As a business owner these new rules will make little difference to us. We have always welcomed older staff – a number of our team are over 65 – and we find their huge experience invaluable. Some employers seem irrationally reluctant to take on older staff – their loss is certainly our gain."

The survey also reported that 76% of employers would support introducing an Employment Tribunal application fee to discourage claims that are made with little realistic chance of success.

For further information, email Nigel or call Salisbury (01722) 422300.