Category: Employment Law, Taxation and Legislation for Contractors

PAYE umbrella companies and other employers have four issues to deal with from the phasing out of the current default retirement age, it has been pointed out.

Business consultancy Mercer said challenges will be raised to human resource policies from no longer being able to 'force' retirement on employees.

The issues will be seen in redundancies, staff motivation, reward and employee benefits, explained head of human capital business at the firm Chris Johnson.

He pointed out that talent management must be balanced between motivating younger staff and harnessing the experience of older workers, while ensuring all have career opportunities.

Cost control in terms of larger salaries for more experienced employees will also be an issue, as will the financial situation regarding pensions and benefits schemes, Mr Johnson continued.

Additionally, redundancy will become a factor that must be carefully considered as all workers should be subject to the same grounds for dismissal.

The phasing out of the default retirement age was announced by work and pensions secretary Ian Duncan Smith and has been widely welcomed.

Posted by John Crawley