DTI publishes consultation document on age

On 2nd July 2003 the DTI published its consultation document on age discrimination, 'Equality and Diversity: Age Matters'. The DTI's consultation document is the first consultation focussing exclusively on legislation to deal with age discrimination affecting both young and old employees.

The consultation document, as well as a summary of the consultation and the DTI's report 'Towards Equality and Diversity', a consultation in 2002 on implementing the European Employment Directive (adopted by the Council of the European Union on 27th November 2000), can be found at www.dti.gov.uk/er/equality/age.htm

Further to the Directive, both direct and indirect age discrimination in employment and vocational training will become unlawful on 1st October 2006 with resulting new obligations for employers, providers of vocational training, trade unions, professional associations and employers' organisations. The DTI seeks comments on proposals for the legislation implementing the new anti-discrimination law under the Directive, including:

• the introduction of a default retirement age of 70, at or after which employers can require employees to retire without justification
• changes to the provisions relating to unfair dismissal and calculation of the basic award:
  • so that employees can seek redress at any age, but retirement at an employer's justifiable mandatory retirement age, or any default age set out in legislation, will be a fair reason for dismissal;
  • changing the way that financial compensation is calculated so that the basic award will no longer be based on the employee's age.
• changes to the eligibility criteria for and calculation of statutory redundancy pay:
  • age will cease to be a factor when calculating the payment due, ie. the calculation will be on the basis of one week's pay per year of service, subject to the current maximum of 20 years, regardless of age, and service below the age of 18, which is currently ignored, will be taken into account;
  • the upper age limit for entitlement to a statutory redundancy payment will depend on the legislative provisions relating to retirement ages but may end either at the employer's normal retirement age for the job, at the default age if one is set or continue as long as the employee remains in employment where there is no normal retirement age and no default is set in the legislation.

The consultation is intended to last until 20th October this year, with the legislation in the form of regulations to be introduced by the end of 2004.