Mace & Jones warns employers of £600m cost of new age laws

A leading law firm is urging employers to protect themselves from the estimated £600m additional cost to business of new age discrimination legislation. According to a Department of Trade and Industry (DTI) memorandum, on the Employment Equality (Age) Regulations 2006, firms should expect to pay £249m to implement changes to their work practices over the next year. The DTI also expects that training employees to enforce the new rules could cost up to £370m and changes to recruitment practices could add £8.8m. Meanwhile the increase in employment tribunals is expected to cost employers a further £30m and taxpayers £9m.

Mace & Jones, a leading national commentator on the age discrimination legislation which came into force on October 1, said the actual cost to employers of enforcing the age laws is likely to exceed the Government estimate of £600m.

“The message to employers is stark,’ said Martin Edwards head of employment law Mace & Jones. “Underestimating the complexity of this legislation or its potential to slice huge sums straight off a business’s bottom line could prove disastrous. Just sitting back and seeing what impact age discrimination will have is tantamount to plunging your head in the sand and waiting to be kicked.”

Mr Edwards said employers should be aware that employment tribunals are gearing up to take on more than 8000 age discrimination cases adding to their current workload of 26,000 cases.

“I would urge employers to look at Ireland where 40 per cent of claims in the Labour courts are related to age laws which came into force seven years ago,’ he said. “If employers want to save themselves the time, money, anguish and frustration of falling foul of age discrimination it is wise to undertake a comprehensive age audit as a matter of priority.”

Mr Edwards said key areas to audit include: Contracts of employment, policies and procedures, recruitment practices, such as job adverts and interviews, annual performance appraisals, promotion, Clear training for people involved in activities that could give rise to age discrimination.

website www.maceandjones.co.uk