Age-related tribunal claims causing headaches for employers

Research from the Confederation of British Industry, (CBI) has revealed that half of all employers are worried about a rise in age-related claims come April 2011, when the default retirement age is phased out.

There has already been a rapid rise in the number of employment tribunals over the last few years – an increase of 56 per cent was noted in 2008/9, taking the number of claims to 236,100, according to the Tribunals Service.

This new research from the CBI reported that half of employers had already seen a rise in the number of claims over the last year and now they are fearful of more, especially of the age-related type.

Currently, 79 per cent of employers use the default retirement age (DRA) of 65, and only 16 per cent have no set retirement age.

John Cridland, deputy director-general of the CBI, said, “In most cases, employers want to keep on staff beyond 65, because they value their skills and experience.

“The DRA is a dignified way to manage cases where performance isn’t up to scratch or people are no longer physically up to the job. Abolishing it leaves a huge void, and has the potential to open the floodgates on age-based litigation.

“Given that some employers are unaware of these changes, the Government needs to give businesses more time to prepare, and provide clear guidance on how to operate without a DRA,” he added.

Now that the DRA is to be removed, 60 per cent of employees feel that it will have a negative impact on younger staff with fewer promotion opportunities.