Firms hit out at retirement age proposals
BUSINESS groups yesterday rounded on plans to scrap the default retirement age (DRA), accusing the government of rushing the proposals through without proper consultation.
From next October, firms will be unable to automatically lay off staff when they reach 65, allowing millions to work into their 70s and 80s.
The DRA?will be scrapped in October but the effects will be felt from April onwards, as employers must give six months’ notice to staff they want to retire.
Unions and charities representing the elderly welcomed the move, but businesses reacted angrily.
Employers’ group the CBI said the timetable had given firms little chance to prepare for the changes.
“Scrapping the DRA will leave a vacuum, and raise a large number of complex legal and employment questions, which the government has not yet addressed,” said CBI deputy director-general John Cridland.
And the Institute of Directors (IoD) hit out at the government, pointing out it came to power on a promise of cutting red tape for businesses.
Graeme Leach, director of policy at the IoD, said: “The coalition agreement states… no new regulation is brought in without other regulation being cut by a greater amount. So where are the announcements outlining the regulations to be cut?”
And Adam Marshall, director of Policy at the British Chambers of Commerce said the plans would restrict businesses’ ability to manage their workforce.
Audrey Williams, a partner at Eversheds, warned younger employees would become disgruntled, as the policy could cause a dearth of promotion opportunities.