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Posts Tagged ‘DRA’

It has been revealed in the past couple of days that there appears to be a serious drafting error in the government’s retirement regulations creating the situation where employers who agreed to postpone retirements by a year or two (until a date between April and October 2011) will face tribunal claims if they are not careful. Effectively, if an employee’s 65th birthday does not fall ‘during’ the transition phase it will be unfair to force their dismissal for reasons of retirement. (The transition phase is during April to October 2011)

This will be a poke in the eye to those employers who were considerate enough to allow employees to keep working when they requested a postponement last year.

Employers who agreed a 12 month postponement thinking they were safe to insist on the retirement as long as it was before the final abolition date in October 2011 will be disappointed. Even if you have an agreement with the employee that they will retire on that date before September 2011, if you insist on the retirement it looks as though you will be in hot water if they sue for unfair dismissal / age discrimination!

Nobody could have predicted this situation as it is clearly an error in drafting. The reality is, however, that we are stuck with it until the legislators sort it out.

The answer in the meantime for those employers who find themselves between a rock and a hard place is probably that the best advice is do nothing until you absolutely have to because lawyers usually work something out, so if you can wait and see what happens, then do so. But if you have to act before a solution is published then take legal advice and do some brainstorming with your lawyer. There will be no gurantees but you will at least know your options and the risks associated with them.

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The draft regulations have been published and as predicted, it looks as though it will be possible to provide insurance benefits to the under 65s but not the over 65s even though on the face of it such a policy would seem ‘ageist’.  Further updates on the effects of the end of DRA will be published as they emerge.

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