Third Age Employment Network

Week Starting 28th February

Equality Bill Published

The Government has just published its new Equality Bill which, amongst other things, will set up the Commission for Equality and Human Rights (CEHR).

The CEHR will take over the work of the three existing Discrimination Commissions (the EOC, CRE and DRC) as well as taking on responsibility for the three new ‘strands’ covering sexual orientation, religion and belief and age.

The purpose of the Government’s Equality Bill is to:

establish the Commission for Equality and Human Rights (CEHR) and to define its purpose and functions;
make unlawful discrimination on the grounds of religion or belief (but not age) in the provision of goods, facilities, services, premises, education and the exercise of public functions (subject to certain exemptions);
create a duty on public authorities to promote equality of opportunity between men and women (the gender duty) and to prohibit sex discrimination in the exercise of public functions.

The Bill sets out the duties and powers of the CEHR. The Commission will have general powers to publish or disseminate ideas and information, to give advice and guidance, to undertake research, to provide education and training and to publish and disseminate ideas and information. It will have the power to work in partnership with and provide grant aid to others in support of its functions.

The CEHR will also be given a range of powers to promote equality and tackle discrimination. These include:

a new duty to consult with stakeholders to ensure all groups have an opportunity to participate and engage in its work;
a new duty to monitor progress on equality, human rights and good relations between communities, through publishing a regular 'state of the nation' report
a new duty to promote good relations between and within communities, across all sections of society
an explicit role to combat prejudice and work to reduce crime affecting particular communities, including new powers to monitor hate crimes
a regional presence across the country, and in Scotland and Wales.

The CEHR will be established in October 2007, although it won’t take over responsibility for Race Equality from the CRE until April 2009.

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One Third Expecting to Change Jobs

New research reveals almost a third (31%) of UK workers plan to change their job in the next twelve months. And although they’re keen to change jobs, employees are not overly confident about their ability to find a new position - 40% expect it to get harder to find a job over the next year.

The research, produced by the Recruitment Confidence Index (RCI), also revealed that manageable hours and an improved work/life balance is growing in importance.

More than half of all staff (57%) say pay is very important to them; 48% say enjoying the job is very important, and 41% say working hours are crucial.

These survey results will be a surprise to many bosses because research carried out by the RCI three months ago found that employers regarded pay, career progression and organisational culture as the three most important factors when it comes to hanging on to talent. Only 26% on employers said flexible working was important and 24% said it had no impact at all.

When it comes to moving on, 59% of workers said they would apply for a new job if the salary was good enough, but 50% said it was important that a new employer offered them good opportunities to balance work with home.

The survey also reveals a lot of dissatisfaction among workers. More than one in three – 35% – are either neutral about or dissatisfied with their current job. This could explain why many respondents appear to be active job seekers. Nearly one in three respondents (31%) say they expect to change jobs within the next year. A further 17% expect to change jobs within the next two years.

According to the Chartered Institute of Personnel and Development, the average cost of replacing an employee is now around £4,500.

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Ageism Impacts All Ages

New research from the Employers Forum on Age shows that ageism may be a bigger problem for school leavers than for people in their 50s. One in four school leavers say they have been put off from applying for a job because of their age, compared to one in five of the over 50s.

The research, which was conducted with 1700 employed people aged from 16-70, also found :-

Young people change jobs more frequently not because they are disloyal but because they feel they are being denied interesting and challenging jobs. 70% believe a career path is important;
Women's promotion prospects suffer from their 20s onwards even before they have children: 37% of men in their 20s hold management positions compared to just 24% of their female counterparts. This challenges current wisdom that women only lose out when they have families;
People in their 50's and 60's aren't all rushing to retire: 30% of people are happy to work until they're 70 and 13% dread retirement, a feeling that increases with age;
People are happier at work the older they get: 93% of the over 60s like work - the highest among all age groups;
Although people in their 30s are at the 'peak' of their career, they're under the most pressure at work and least want to be there. Just 54% of those in their 30s are happy with their work-life balance and just 17% are happy to work until they're 70 - the lowest numbers among all age groups;
Older employees aren't all technophobic: the over 50s are as keen to get to grips with new technology as teenagers. Seventy-four per cent of the over 50s like to keep up with new technology, only 5% fewer than teenagers.

Sam Mercer, Director of the EFA, says: "This is a wake-up call for employers: we need to break the stereotype habit and be much more aware of peoples' needs at different stages of their working lives. Our research maps, for the first time, the motivations and attitudes of different age groups - and is an invaluable resource for employers that need to understand their workforces.”

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Week starting 21st February

Minimum Wage Rises Announced

Cynics amongst you might suspect the timing, but the Government has announced that if it wins the general election it intends raising the Adult Minimum Wage to £5.05 an hour from October this year and to £5.35 an hour from October 2006.

The rise is in line with the recommendation of the Low Pay Commission. The increases mean 1.3 million workers will be covered by minimum wage from October this year and 1.4 million from October the year after.

Announcing the latest increases Patricia Hewitt, the Trade and Industry Secretary, said, "The great news is that well over a million workers will receive a guaranteed pay rise by this October, rising to almost a million and a half people by October 2006.

"The minimum wage has made a real difference to the lives of thousands of low paid workers - particularly women, who make up some 70 per cent of those benefitting. Year on year increases protect some of society's most vulnerable people from exploitative rates of pay.

"Despite predictions to the contrary, the national minimum wage has not affected the job prospects of low-paid workers in the UK. Unemployment is at record low and a record 28 million people are now in work."

The Government has also:

agreed that the Low Pay Commission should review the 2006 rates, taking into account the latest economic conditions.
agreed that the youth rate, which applies to 18-21 year olds, should rise to £4.25 in October 2005 and £4.45 in October 2006.
agreed that the Commission should review the operation of the 16-17 year old rate and report in 2006.
announced that it will keep the issue of whether to put 21 year old workers onto the adult rate under review.

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Financial Assistance Scheme Offers Small Pension Comfort To Some

Workers who were within 3 years of retirement when their company pension schemes went bust are to receive up to 80% of their pension from the new Financial Assistance Scheme (FAS). The money will be paid as a top-up pension to current members aged between 57 and 73 – depending on the pension age of their particular scheme.
The Scheme was set up under the new Pensions Act in response to widespread public concern and political pressure about workers facing the loss of all, or most of their occupational pensions, because their companies had gone bust before the new Pension Protection Fund comes into effect.

The Government has committed £400m of public money to the FAS over 20 years.

Malcolm Wicks, the Pensions Minister said that workers who were only a few years from retirement when their company schemes folded had been hit hardest - losing both their jobs and their pensions with little chance to start again.

"We urgently needed to give these people peace of mind by making their position clear, and today we are doing so, by announcing through FAS they will now get 80% of the core pension benefits for life," he said.

At present there are at least 380 schemes where members may be eligible for assistance but schemes who may still consider themselves as potentially eligible can contact the Department for Work and Pensions.

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Tories Launch Manifesto For Older People

As the expected general election draws nearer, all the political parties are lining up to woo the crucial ‘grey vote’. Michael Howard has promised older voters :-

A bigger basic state pension linked to earnings rather than inflation.
Lower council taxes – an automatic 50% discount up to a value of £500 for households made up of adults aged 65+.
Reversing the spread of means-testing.
Long-term care – no one will be forced to sell their home to finance long-term care.

At the same time, no one will lose out says Howard. The Pension Credit will not be abolished, neither will free TV licences for the over 75s, or the Winter Fuel Payments.

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Half Of All New Jobs in The Public Sector.

Since 1997, almost half of the jobs created in the UK have been in the public sector. Over 861,000 new jobs were created in the public sector between summer 1997 and autumn 2004. One in four employees now works for the State.

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Sole Employees To Save On Insurance

From next Monday (28th February) companies which employ only their owner will not have to purchase Employers’ Liability Compulsory Insurance.

Minister for Work Jane Kennedy said: “Hundreds of thousands of limited companies, where the owner is the sole employee, will benefit from the new rules. Removing the requirement to purchase ELCI could save companies hundreds of pounds each year.”

It is estimated there are around 300,000 small companies that will be able to take advantage of the rule change, which was made following a wide-ranging consultation on whether to remove the requirement. The change was announced in October last year.

The Association of British Insurers estimates that the average saving for each company might amount to around £250 a year.

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Week Starting 14th February

Rutherford Case Goes To The House of Lords

The House of Lords has confirmed it will hear the Rutherford case appeal. If the appeal is successful it would extend employment rights on unfair dismissal and redundancy pay to people over 65.

John Rutherford and Samuel Bentley initially won their employment tribunal case to gain these rights on the grounds of sex discrimination but the Department of Trade and Industry (DTI) managed to get the original decision overturned by the Employment Appeal Tribunal.

Last year the case went to the Court of Appeal but they upheld the decision in favour of the DTI.

A spokesperson for the law firm representing the two men said, “The House of Lords only hears appeals if the case involves a ‘point of law of general public importance’ that it ought to consider. We believe we have a strong case that raises questions about the way we treat older workers.”

The case is not expected to come before the Law Lords for at least 12 months however….

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Apprenticeships Face Funding Crisis

If you’re over 25, or 21 even, and would like to do a funded apprenticeship – don’t hold your breath. The Learning & Skills Council is struggling to find enough money
to fund apprenticeships for 16-18 year olds.

The problem, according to the LSC, is due to the success of measures aimed at improving the retention and completion rates of young people on apprenticeship programmes. This success threatens its ability to meet its PSA (public service agreement) target for 175,000 youngsters aged 16-21 to have started apprenticeships in the year to July 31st.

Graham Hoyle of the Association of Learning Providers, whose members act as brokers, recruiting would-be apprentices and matching them to employers and then training them, commented, “The problem is that retaining more youngsters on the programme through to completion costs more per apprentice than the higher turnover, early-leaver pattern of previous years.” With 6 months of the academic year left to run, the training providers are saying they can’t take on more apprentices unless they get more money from the LSC.

The costs of training apprenticeships range from £3,500 over 12-15 months in hospitality and retailing to £14,500 over 42 months in engineering and construction.

The LSC has a statutory duty to fund apprenticeships for 16-18 year olds and must also fund 19-21 year olds if funds are available. Those aged 22-25 come way down in the funding pecking order. And despite all the announcements about lifting the age lid on apprenticeships, those over 25 aren’t even a blip on the horizon.

So we wait to see with interest what the White Paper on Adult Skills has to say about ‘adult apprenticeships’ when its published later this month. We expect fine words and very little action or money – but would love to be proved wrong.

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Big Rise In Number of Employers Struggling To Find Skilled Workers

Figures just released by the British Chambers of Commerce (BCC) show a 50% rise in the number of employers reporting difficulties recruiting staff with the right skills.

A comparison of the 1994 and 2004 findings from the BCC’s economic survey show a rise in the number having these difficulties from 29% in ’94 to 43% last year.

David Frost, Director General of the BCC commented, "Employers tell us all the time that they are frustrated that young people are not equipped with the right skills for the workplace. The system is simply not providing potential employees with the right skills for business and our figures show it has been failing for many years. The skills of our workforce are already lagging behind many of our global competitors.”

A greater willingness to recruit, retain and train older workers should be part of the response of BCC members to the skill shortages that are confronting them.

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Week starting 7th February

Redundancy Rights For Workers Over 65

The Government has decided to extend redundancy rights to workers aged over 65.
According to the Financial Times the decision was revealed at last week’s meeting of the Age Advisory Group (AAG), chaired by Jacqui Smith, the Equality Minister at the Department of Trade & Industry.

It was the first time the AAG had met since the national default retirement age decision was announced before Christmas and they were reviewing the progress being made in drawing up the draft age regulations. Progress had been delayed for months by differences within government between the DWP, DTI and 10 Downing Street on the issue of whether mandatory retirement ages should be abolished or not.

Regular readers will remember the DTI contested and won its appeal in the Rutherford case, but had indicated that the extension of redundancy and unfair dismissal rights would be dealt with in the 2006 age discrimination regulations.

What hasn’t been decided yet is the basis on which redundancy payments will be made. Currently for workers aged between 41 and 65 payments are based on 1.5 week’s pay for each year of service up to a maximum of 20 years. In its Age Matters Consultation, the DTI proposed reducing that back to 1 week’s pay – the rate for younger workers. This ‘rounding down’ proposal was roundly condemned by ‘age lobby’ organisations such as TAEN.

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IB Benefit Changes Clarification

Alan Johnson, the Work & Pensions Secretary, has made clear the changes proposed last week to Incapacity Benefits will not come into place until the Pathways to Work programme is rolled out nationally. This means that unless the Treasury releases more money in the meantime, the earliest this can happen is 2009.

(click here to read earlier item).

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Employers Shore Up Their Final Salary Pensions Schemes

Employer contributions to their final salary pension schemes went up by 50% last year. The value of payments soared to £8.2 billion from £5.5 billion the previous year. A third of these payments were special contributions to help tackle big deficits in many of those funds.

The research by Income Data Services of 284 schemes showed huge variations. Some schemes are still in surplus so employers took contribution holidays, while in some other cases firms had doubled their contributions.