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Issue:- 05 August 2010

Forum voices opposition to ‘crippling’ retirement age plans

A small business support group has hit out at plans to abolish the default retirement age.  The new Government this week said it intended to press ahead with the previous administration’s plans to remove an employer’s option to retire staff at the age of 65.  If the proposal goes ahead, businesses could be forced to start keeping on staff indefinitely in little over a year’s time.

The Forum of Private Business believes that this could prove highly damaging to thousands of small firms.

Currently, there is nothing to stop an employee working on past 65, providing his or her employer agrees to it. 

Many businesses are well aware of the skills and experience older workers provide and are happy to maintain their employment.  However, if the default retirement age is scrapped, business owners will be forced to keep on workers past the age of 65, whether they want to or not.

This, the Forum believes, will prove a huge problem for thousands of small firms, hampering their abilities to plan for the future. The move could also open the door to costly and painful employment tribunals, as an employers’ only means of ending employment will be through a ‘capability dismissal’ based on the declining competence of the worker.  In recent survey, just 4% of Forum members felt removing the default retirement age was justifiable.

Forum spokesman Chris Gorman said:- “We are by no means disputing the valuable skills and experience older people bring to the workplace.  Many small businesses are happy to keep on members of staff well into their late 60s and 70s – indeed, many Forum members themselves are well over 65.   However, removal of the default retirement age will cripple some small businesses by removing the tools that help them to plan for the future.  Most employees are certainly competent enough to work beyond the age of 65 without a significant deterioration in their abilities. However, for those employees not willing to leave voluntarily, there will eventually come a time when the needs of the business will have to be considered.  In the absence of a default retirement age, the only viable option available to an employer is a capability dismissal based on the declining competence of the worker. We believe this would be an undignified and humiliating end to a career for most staff.”

Forum member Stuart Mitchell, of Derbyshire-based Machine Building Systems Ltd, agrees.  He said:- “What this proposal will do is to force employers into a situation where they have to spend huge amounts of time taking older employees through a disciplinary process in order to end their employment.  Many an employer has allowed someone a dignified retirement because although they were not really up to the job any more, it was only a matter of waiting a few months or a year, and the problem would resolve itself happily.  Once this rule comes in, that will be pointless and they might as well start the unpleasant and costly disciplinary process straight away as it will be inevitable at some stage. What effect will huge numbers of these disciplinary proceedings have on the morale of the other employees? Never mind that of the boss who does not enjoy the process any more than anyone else.”

Mr Mitchell added:- “Employers are people too, and their morale is of vital importance. To deliberately and knowingly set up avoidable conflicts, is a stupid way to govern.”

The Forum set out its views on the issue in response to a Government consultation in February, emphasising the need for small firms to be able to plan ahead, especially during times of economic uncertainty.  The Forum also pointed out that just last year, the Government defended the default retirement age in the High Court, arguing that it brings numerous social benefits.

Following the Government announcement regarding the abolition of the default retirement age today, Beth Hale, associate in the employment group at law firm Stephenson Harwood comments:-

Announcement not thought through

"Whilst abolishing the Default Retirement Age (DRA) altogether may be viewed as a laudable aim in terms of allowing older workers the flexibility and freedom to continue in employment for as long as they want, it does not appear that either the government have thought through fully what this will mean in terms of costs and administrative burden for employers, let alone the potential impact it has on younger workers who are looking to break into the job market. These issues will be particularly acute if the change is brought in quickly, as is currently proposed, rather than on a staggered basis.

A more sensible approach than total abolition is an increase in the DRA, possibly staggered over a period of years (whether in accordance with or ahead of the increase in state pension age) and preferably in tandem with an increase in rights to request flexible working for older employees as suggested by the EHRC."

Added difficulties for employers

"If employers are no longer able compulsorily to retire employees at a certain age, it will make effective succession planning extremely difficult. Employers will not be able to predict accurately when senior employees are likely to leave employment and will, therefore, struggle to ensure that their successors are in place and ready to take over as and when necessary. This also potentially risks creating resentment and tensions within the workforce as younger employees feel that they are hitting up against a glass ceiling and unable to progress beyond a certain level as they wait for their older colleagues to vacate positions."

Employer responsibility and support for older workers

"A key area that has not been properly addressed in the shouts for the abolition of the retirement age is how employers could deal with the additional cost of continuing to provide benefits for employees who work beyond 65. Employers are often reluctant to continue employment after 65 not because they don't want to, but because they can't afford to. At present the cost of benefits such as life assurance and private medical cover increases significantly after age 65 and is often prohibitive, if such cover is available at all. If the government is serious about encouraging employers to retain workers for longer, this is an issue which needs to be urgently addressed – at present, it often isn't economically viable for employers to keep people on after 65."

Death by disrespectful driving costing drivers their lives and millions on premiums

A new report from leading UK insurer, AXA, calculates that 800 lives are lost on Britain’s roads through accidents caused by road rage or disrespectful driving, and nearly £1 billion (£945m) of premium could be saved if British motorists were to rid themselves of the aggression and general disrespect of their fellow drivers that is commonplace on our roads.

The insurance business has launched findings of a report this week that illustrate the extent to which road rage or ‘disrespect’ on the UK’s roads costs drivers in terms of numbers of deaths a year. The nationwide independent survey reveals that almost 40% of drivers involved in the 222,100 accidents on British roads ever year say they were frightened or angered by other drivers in the critical moments before a crash.  Of those, more than 20% said the inconsiderate driving had come in the form of speeding, 25% said that others were driving erratically, and more than 20% said another driver had been ignoring road rules and signs.

The calculations are based on research that shows 35% of drivers involved in more serious and costly accidents (those with a ‘personal injury’ element where someone is either killed or injured) were either made angry or frightened by another driver’s behaviour moments before the accident. Put simply, if these drivers were to drive better and more considerately then the number of deaths and premiums would come down

Over the last year, motorists have seen premiums rise rapidly - 11.5% in the 3 months to June 2010 alone. As well as the costs AXA calculates for disrespectful driving, the British motorist already pays an estimated £30 per premium for uninsured drivers and £44 on their overall household insurance bill to cover fraud.

According to motoring psychologist, Peter Marsh, disrespectful, aggressive driving can be the cause of an accident in itself but also the negative emotions created by this type of driving can cause other drivers to become irrational and make mistakes they would otherwise not make.

He said:- “The study highlights clearly the powerful psychological forces at work when we get behind the wheel of a car. Our cars may be safer than before and our roads increasingly designed to reduce accidents but unless we recognise and deal with the strong emotional aspects of motoring, the factors that give rise to uncharacteristic belligerence and sheer bloody-mindedness, we may never be able to reduce much further the number of people who die unnecessarily on Britain’s highways.”

Research carried out earlier in the year by AXA found that 79% of drivers believe that British drivers are generally disrespectful to fellow road users, with 52% having been subjected to a ‘significant’ act of road rage – shouting and aggression rather than just a quick honk of the horn or a hand gesture.  And 53% of drivers admit to sometimes behaving aggressively behind the wheel while nearly 20% will often behave in this way.

The behaviours categorised by motorists as ‘disrespectful’ range from speeding, driving erratically and ignoring road signs to beeping a horn in anger, making offensive hand gestures, yelling, swearing and flashing headlights.

Over the last year, motorists have seen premiums rise rapidly - 13.4% in 2009. The group calculates that around £35 per premium pays for accidents caused by disrespectful driving, and and as well as these costs, the British motorist is also paying an estimated £30 per premium for uninsured drivers.

Craig Staniland, AXA Insurance director for motor says:- “Disrespectful driving seems to be reaching pandemic proportions as drivers fail to see the potential consequences of thoughtless driving. Our research shows that something so simple to rectify – ie driving more courteously – is costing lives. A return to good manners and consideration could prevent nasty accidents and needless anguish.  We are also very concerned that a continued lack of respect on the road will drive up premiums further. Personal injury costs are escalating as it is – if we can cut back the number of accidents through a less aggressive and more considerate approach to the way we drive then it will be to the benefit of all drivers”.

Additional research findings revealed that:-

► 6% of those questioned admitted that they themselves had been disrespectful to another person in the moments before an accident with 20% of these admitting that they had been abusive to other drivers before the accident.

► Other drivers’ behaving erratically was the thing that motorists most commonly cited as disrespectful behaviour on the roads followed by ignoring road signs/rules and speeding. Abusive behaviour was also listed.

► Around 20% of drivers were frightened or intimidated by the driver of the other vehicle after the accident had occurred rather than just before.

► It took those involved in road accidents on average more than 18 hours to get over how the immediate emotions of the accident made them feel.

► Around 13% said an experience of disrespectful driving had made them less likely to drive in the future.

Join our campaign for respectful driving online now!


A 24 year old man from Dingle in Liverpool on 30 July 2010, was arrested in connection with the murder of Paul Pike in Waterloo on 5 June 2010. Mr Pike, from Belle Vale, was shot in his van while waiting a traffic lights at the junction of Crosby Road North and South Road at around 11.20pm on the 5 June 2010. Following that a murder investigation was launched and two men were arrested on suspicion of murder. The 24 year old man from Netherley who was arrested on June 15 and a 23 year old man from Allerton who where arrested on 14 July 2010 were subsequently released on Police bail pending further enquiries. The new man to be arrested is from Dingle area of Liverpool. Anyone with information about the incident is asked to call the Major Incident Room on:- 0151 777 8629, or Crimestoppers, anonymously on:- 0800 555 111.

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