Diane Nicol: Fertile ground for age discrimination claims

Published on Thursday 29 July 2010 19:03

THE UK government's selling point for this policy is that people are getting healthier and this gives them the opportunity to work longer.

However, it could open the door to litigation that could be very expensive for firms.

If for example a firm decides to retire someone at 55 or even at 65, because there's no retirement age an employee could potentially claim that they are being let go because of age discrimination.

The difficulty for firms is that objective justification for retiring someone is quite a difficult thing to prove.

This could be fertile ground for litigation and as there's no financial limit on age discrimination claims, we could see a significant number of law suits.

In the past having the retirement age of 65 meant that there was a safety net for employers when it came to people being retired from a firm, providing they followed the correct procedures.

This is an area that will be fruitful for lawyers and it's potentially challenging for employers.

There could be opportunistic claims and firms could have to prove that there was an objective justification to retire a person at a particular age.

It's not an easy defence for firms to make, so the changes could pose a real risk to some businesses.

A lot is going to depend on how well advised firms are and they will also have to analyse retirement situations very closely and take experts advice before each decision about an employee.

Decisions about this cannot be taken lightly and businesses are going to have to reassess their whole approach to retirement.

The issues and potential for disputes surrounding this could prove costly for business, and if companies take measures to protect themselves, it could be money well spent.

The thinking will very much have to be that prevention is better than a cure.

Diane Nicol is head of the employment team at McGrigors law firm in Glasgow