On Friday the Government has confirmed it wants to "deregulate and cut back on bureaucracy" and to "create fair, simple processes that are good for business and good for employees too".
The announcement about protected conversations, follows the confirmation of its intention to increase the qualifying period for bringing unfair dismissal claims from one year to two years from next April and to introduce fees for potential claimants bringing employment tribunal claims.
Naeema Choudry, partner at international law firm Eversheds, comments: "This could be extremely helpful to employers in the aftermath of the abolition of the Default Retirement Age (DRA). Employers need to know about employees' future plans to help plan succession. Employees may also want to be able to talk about the options available for winding down or redesigning their job specification. Now the DRA is abolished, neither side is protected if these conversations are had.
"Though the devil will be in the detail, this legislation could allow employers to raise the issue of an employee's future plans when they reach a certain age without fear of an age discrimination claim. It could do so by making such a protected conversation exempt under the age regulations, so it does not constitute discrimination. The age at which this would kick in may be a subject for consultation, but it is to be hoped that the fact that employers need to plan for an employee's retirement long before they reach 65 will be taken into account. A reasonable age could be 55 or over. It also remains to be seen whether a formal procedure will be introduced. Though this could be viewed as overly bureaucratic from the employer's perspective, a more formal procedure might provide employees with more confidence about raising the issue. If the employer cannot accommodate the employee's wishes, one assumes the employee would have the right not to suffer prejudice as a result of raising the issue.
"This could also have a significant impact for employers dealing with performance issues, potentially permitting tough conversations about employees' performance without fear of recrimination in the employment tribunals for having tackled issues head on. The effect could well be that employers could avoid drawn out capability procedures in some circumstances."
