Yes, my Lords, we encourage good workplace relations that will build loyalty and dedication. In outlawing unjustified age discrimination in employment and vocational training, the Employment Equality (Age) Regulations will help employers to attract, motivate and retain loyal and dedicated staff and make the best use of the skills and experience available to them.
My Lords, I think I thank the Minister for that reply. Do not the regulations make it at the very least a deterrent in practice for an employer to reward long, loyal service with such benefits as sabbaticals, incremental holidays or even gold watches? Are they not a classic example of the law of unintended consequences?
No, my Lords, I do not believe that to be the case. Fundamentally, the regulations outlaw age discrimination in employment and vocational training unless objectively justified. When it comes to benefits—for example, insured benefits—the regulations are specifically framed in such a way as not to discriminate against various groups, such as women. Where there is a limit of, for example, five years’ service, beyond which it would be unfair to discriminate against certain groups such as women who may take career breaks, employers have an exemption up to that point; if they wish to retain staff by offering other benefits and can objectively justify those benefits, they can offer them.
Yes, my Lords, I agree with the noble Lord. The part of the regulations that specifically refers to his point says:
“Our aim over time is to move to a position where there is no compulsory retirement unless it can be objectively justified by individual employers”.
Many of us would support that principle.
My Lords, I want to reflect on the experience of many elderly people in the Chamber. When I started work in the steel industry, blue-collar workers did not have a pension scheme but white-collar workers did. When I started, people well into their 70s were working in the steel industry. As a young man, I thought it was awful. Under public ownership, we—mainly on these Benches, I suggest—achieved our goal of retirement at 65, sick pay, holiday pay and reduced hours of work. With the proposed steps, are we making progress?
My Lords, we are absolutely making progress—that is what the regulations are about. People can now work up to the age of 65, beyond which point employers will have a duty to consult them before making them redundant. People’s pensions and entitlements have also improved over the years.
My Lords, employers have been told that they must prepare for these regulations; it will be their duty to ensure that their schemes meet the requirements. It is the duty of employers, the Government and all of us to ensure that people are aware of their rights.
My Lords, it is up to the employer to objectively justify entitlements. They can outline the position of objective justification, but it is up to them to justify the benefits as being in keeping with the regulations. As long as the benefits match the statutory schemes and benefits, they are within the regulations. If the benefits go beyond the regulations, the employers might have to objectively justify those entitlements and show that they are not discriminatory.
My Lords, is it not a fact that, every time new anti-discriminatory legislation has been introduced, we have had the same queries and criticisms of its effect, which have proved unfounded? Has not justification featured in previous legislation and been clearly defined in the courts and tribunals?
Yes, my Lords. I do not wish to open any old wounds, but did we not have the same discussion about the minimum wage when it was introduced? A lot of people criticised it then. On the legal point, the European Court of Justice will be considering the whole issue. My right honourable friend the Secretary of State for Trade and Industry supports the referral to the ECJ, which is proposed by Age Concern, and that will clarify the law.
My Lords, we on these Benches support the elimination of discrimination on any grounds other than merit, but the objective justification to which the Minister has referred is extremely complicated, as he himself allowed us to understand. It is so rigorous that an unintended consequence of these regulations is that employers are experiencing dramatic increases in costs, such as insured benefits, which are likely to reduce employment opportunities after 65 as smaller employers are unable to afford the increased costs. Why did the Government not foresee and plan for this, and what will they do to resolve these problems?
My Lords, there has been an awful lot of consultation and guidance on these issues. The regulations and guidance were consulted on, and the Government have taken comments from employers’ organisations, age lobby groups, trade unions and employment lawyers. The DTI and ACAS have worked extremely closely to ensure that the guidance is useful for all. I can inform your Lordships’ House that information is available on websites such as the DTI Directgov Business Link and the Employers Forum on Age. If Members are interested, they can use the interactive tool to help individuals to understand the new retirement procedure. I commend it to the House.