October is D-Day for scrapping the default retirement age (DRA). I expect that, for most British workers, it will go unnoticed. I also predict that it will not be too many years before we all find it quaint or outrageous that employers were ever allowed to discard staff in such a way.
But until workplaces readjust to the end of the DRA, there are likely to be teething problems. As with any change, it will take time to bed down and work through the finer implications.
This magazine has looked into the benefits-related issues involved in working past age 65 many times – in particular with reference to group risk insurances. In this month’s cover story, we take a step back and look at the bigger picture and how longer working lives will affect the workforce, because no longer having a ‘retire-by’ date will not only affect older staff, but those wetter behind the ears might also feel the impact.
Employers need to rethink, or at least tweak, their career succession plans and work out how their talent needs will alter, years and decades hence. One of the tools that can be used to change workforce behaviours and help with necessary adaptations is the reward and benefits package.
For example, the rules around flexible retirement and drawing a pension flexibly have been in place for many years, but have been little used by many employers. There is plenty of opportunity here to allow older staff to shift down a gear to either work fewer hours or move to easier job roles while supplementing any reduction in wages by drawing some of their pension.
Over the pond, American academics have been examining the issue of the implications of the ‘geriatric workforce’ for some years. From increases in general aches and pains, backaches and cancer, through to reductions in mental agility, myriad health and wellbeing issues will become more, not less, common over time. Some of these can be mitigated with early – and cheaper – interventions with younger staff, but such adaptations need to be considered now.
Overall, the scrapping of the DRA will have a huge impact on workforces, but this will only become evident in decades to come.
Debi O’Donovan, editor
Follow on Twitter @DebiODonovan
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