6 Best Practices to Prevent Age Discrimination Claims
The average life expectancy has steadily been rising over the past several decades, and as a result, people are remaining in the workforce longer—making organisations increasingly multigenerational. In fact, there are an estimated 1.3 million employees over the age of 65 currently employed. However, as the number of older workers has increased, so has the potential for an organisation to be served with an age discrimination claim—which cost an average of £9,000 in 2015-16.
To protect your organisation from such a claim, review the following six best practices for preventing age discrimination claims:
- Audit your pension scheme. Conduct a review of your pension scheme with your advisers to determine whether there are any rules or practices that may be potentially age discriminatory. If there are, determine whether the provision falls within a statutory exemption or whether it is capable of being objectively justified.
- Carefully review benefit change exercises. Review benefit restricting proposals in order to assess whether there could be age discrimination inadvertently included. If any are identified, verify whether there are any objective justification reasons for pursuing that particular strategy.
- Clearly communicate with your staff about pension benefits. All communications to employees about pension benefits should be clear and free of jargon to avoid misunderstandings. Encourage staff to talk to you if they have any concerns or questions about their pension benefits.
- Do not rely solely on exemptions to cover every age-related rule. Whilst some statutory exemptions for pension practices do not constitute age discrimination, you should verify that you are not inadvertently in violation. In addition, you should remain aware of wider changes in employment laws to ensure that your pension practices remain up to date.
- Examine your organisation’s practices and provisions. A practice or provision cannot be deemed to be age discriminatory if it can be shown to be objectively justified. In order to receive this qualification, you must prove that there is a legitimate aim being pursued and that the means of achieving that aim are proportionate. Each requirement will be investigated to ensure the validity of the claim.
- Be sure to consider insured benefits. Review insured benefits—specifically ill-health and death benefits—to ensure that applicable employees remain informed about whether or not they still qualify for those benefits.
In addition to the above best practices, consider shoring up any potential gaps with employment practice liability insurance. For more information, contact the professionals at MFL today.