Saga publishes two guides to working life after the default retirement age (DRA) officially ends – one for employers, one for employees
To download a copy of the Rethinking Retirement guide for Employees please click here.
To download a copy of the Rethinking Retirement guide for Employers please click here.
Today marks the end of the default retirement age. From now on, employers can no longer sack workers just for being 65. At a time when people are living longer and the country faces unprecedented economic challenges, Saga says this is only the first step towards rethinking retirement. The UK must nurture a “personalised retirement” culture if the country is to cater for its ageing population.
Dr Ros Altmann, Director-General, Saga said: “Many people want to work beyond retirement age, saying it keeps their mind alert and that they want to ensure continued income in later life.
“To make sure we do this to the benefit of UK workers, we need to alter our approach and mindset to retirement. This culture change means that the Government must encourage employers to make retirement a process, rather than an event.
In order to assist with this Saga is today launching two guides outlining what employers and employees need to think about in this new workplace world.
“Rethinking Retirement” Pensions Minister addresses Saga Thought Leadership Seminar
Saga believes that the end of the DRA is a tremendous opportunity for the UK’s over 50s. This represents a whole new world of work for all of us as we approach retirement. There has not been much preparation for this momentous change, so Saga decided to organise a “Thought Leadership Seminar” to focus on life in the workplace without a DRA.
Saga assembled the UK’s leading experts, including Steve Webb, Minister of State for Pensions, thought leaders* from Westminster, Whitehall, the private sector, interest groups and the press to a Rethinking Retirement seminar in The House of Commons to brainstorm the challenges faced by an over 50s workforce. Discussions were chaired by Dr Ros Altmann, Director-General, Saga and Steve Webb led the keynote address.
Changing workplace for older workers
Six major driving themes emerged from the seminar, which the UK needs to tackle in order to combat ageism in this new era post the end of DRA.
1. Collate and disseminate the business case for employing older workers
The seminar called for a need to strengthen the business case for employing older workers. The Minister hailed MacDonald’s as a company that has already led by example but many more must follow. Many businesses stress that employing older workers is not about being kind, it is actually about improving the bottom line!
2. Public Sector to lead battle in fighting ageism
There was general agreement that although cultural attitudes to older workers were changing there was still a long way to go in educating people and employers. To help that process, the public sector should give a lead in terms of fighting ageism in the workplace.
3. Avoid generational backlash
While opportunities for older workers are essential, it is important that younger generations do not miss out on career development opportunities.
Youth unemployment is not a problem caused by older workers staying "too long" in jobs which might otherwise go to a young person. Youth unemployment tends to be rather a consequence of general economic downturns and/or shortcomings of educational systems and labour market institutions.
4. Bridging the digital divide
Training in new technologies and computer literacy should be made available for older employees. While many over-50s are competent in this area, older people returning to work from a long period of absence might benefit from such training and also help in remaining socially connected as they ease out of the workplace and into their retirement.
5. Improve lifetime savings vehicles
The need for flexibility. The UK must move away from the concept of the default retirement age and a necessity to annuitise pensions at a premature stage and ensure we begin to think more laterally about the concept of a lifetime savings account. Everyone’s needs are individual, and current systems of support have proved too inflexible to cater for our individual needs and aspirations.
6. Are stepping up and stepping down mutually incompatible
Cultural change must mean that employers should open up opportunities to older people for promotion if they have the aspiration and ability, and for older people to begin phasing down if that is their preference. The key is flexibility and age-blindness.
Speaking at the event, Steve Webb, Minister of State for Pensions said: "We as Government do not think it is right to look at the date on someone’s birth certificate when deciding if they have a right to stay in employment"
Commenting on discussions from Saga’s Rethinking Retirement Seminar, Chris Ball, Chief Executive, TAEN – The Age and Employment Network, said: “Employers adopting a positive approach can be extremely beneficial.
“Many people want to continue working and earning in some way. Part work and part retirement makes an awful lot of sense.”
Saga publishes two Guides to Working after the DRA ends
Saga’s guides coincide with the end of the DRA, a move that Saga has warmly welcomed, knowing that many older workers would prefer to continue working than be forced to retire at an arbitrary age.
Dr Ros Altmann said: “We are delighted that the Government abolished the default retirement age. It should have been done years ago. We have been very concerned to see recent cases of employers outrageously forcing their workers in to retirement before the new regime sets in – this is a sheer disgrace.
For both employers and employees wondering what opportunities and challenges will arise from now on, we hope our Saga Guides to Rethinking Retirement will prove very useful reading.
“We encourage any workers who have been forced to retire from their jobs to look at our guides and to consider their options. There are many alternatives for part time and flexible work open to people over 65 and we encourage people not to give up.”
*Attendees to Saga’s rethinking retirement seminar included:
· Prof Steve Webb MP, Minister of State for Pensions
· Stephen Lloyd MP
· Baroness Prosser, EHRC
· Elaine Squires, DWP
· Chris Ball, The Age and Employment Network
· Dennis Gissing, BT
· David Brown, PWC
· Mike Palmer, MPHR
· Niki Cleal, Pensions Policy Institute
· Caroline Massingham, ASDA
· Karen Talbot, Commercial Occupational Health Providers Association
· Helen Coulson, Tax Incentivised Savings Association
· Tracy Fraser, Association of British Insurers
· John Ross, Employers Forum on Age
· Dr Debora Price, KCL
· Dr Wilson Wong, Work Foundation
· Genevieve Bach, CIPD
· Jill Insley, Guardian
· Sarah O’Grady, Daily Express
· Julian Knight, The Independent
**Executive Summary from Saga’s rethinking retirement seminar
1. The Minister described how Black Box work programmes, the introduction of Universal Credit, the abolition of DRA and changing cultural attitudes should result in new opportunities opening up for older workers to stay in the workforce longer, or return to the workforce even after possibly lengthy times on benefit.
2. The public sector, in its own employment practices, could do more to give a lead and reshape the employment culture.
3. The hard-nosed business case for employing more older workers should be collated and disseminated. The DWP should devote a website to examples of best practice and how they serve the bottom line.
4. We may have compartmentalised our thinking too much in the past, devising welfare systems for different phases of our life cycles: just as Universal Credit will be a more individualised system of support, can we devise a lifetime savings scheme partly funded by abolishing or reshaping other benefits so that we can dip into our lifetime entitlements as and when the challenges of life necessitate it?
5. We must avoid intergenerational conflict by demonstrating robustly that older workers do not crowd out opportunities for the younger, and that tax incentives to employ older workers are not inequitable to those starting their working careers.
6. More training in new technologies and computer literacy made available for older people.
7. Cultural change must mean that employers should open up opportunities to older people for promotion if they have the aspiration and ability, and for older people to begin phasing down if that is their preference. The key is flexibility and age-blindness.
Research from Saga among 14,178 people over 50 found that 85% thought that employees should, where practicable, have the right to a staged retirement.
The survey was conducted from 17th – 22nd December 2009 among the SAGA Populus Panel of 14,178 people.
For more information please contact the Saga Press Office on 01303 771529
To download a copy of the Seminar summary please click here