Only 16% of employers surveyed had started to make any provisions for the abolition of the default retirement age and only 24% agreed with the Government's plans.
Law firm DWF commissioned the survey regarding the Government's proposal to abolish the current default retirement age of 65 on 6 April 2011. Over 100 HR directors from businesses across the UK were surveyed, with results indicating major concerns about the proposals.
Following the survey, DWF held an HR directors' forum in conjunction with the Employers Forum on Age. Hosted in two locations, Manchester and London, it brought together a cross-section of employers to discuss the survey results and the implications of abolition of the DRA.
The forum overwhelmingly supported the Government's proposal to abolish the default retirement age. The view was that employers would deal with each employee on a case-by-case basis. The aim is to have a consensual retirement policy, working with employees to help create realistic solutions for working beyond 65.
The forum agreed that strong performance management, applied consistently, was essential to managing the change in the DRA - backed with retirement planning and education given at the start of an employee's career.
Kristy Rogers, head of employment at DWF, said: "Employers might have real concerns about the default retirement age - but if they plan and prepare, the process of change can be well managed. Our forum recognised abolition of the DRA is being treated with a cautious optimism. Employers might be worried about cost, but they are embracing the opportunity for implementing flexible working practices."
The forum's concerns about pension arrangements were in line with the DWF survey - nearly two-thirds of employers and professionals surveyed thought the change in law would lead to substantial changes to their staff pension arrangements and nine out of ten thought employees may lose benefits in kind as a result of the changes.
The majority of employers had not reviewed their pension scheme rules, their death-in-service benefit (usually linked to their pension scheme) or their insurance-related benefits, to establish the cost of providing these benefits to employees over the age of 65. A lot of work will need to be done and the conclusion was that employers must take steps now to ensure they are ready.
