Phasing out the Default Retirement Age (DRA)

The Coalition’s Programme for Government commits Government to phasing out the Default Retirement Age (DRA). The three month Consultation Period ends 21 October 2010. A report will be published in November 2010. Implementation begins April 2011.

What do these proposals mean for organisations? What should owners, MDs and CEOs consider? This paper, by Business and Management Coach Barry Elliott, addresses key issues and is a call to action. (visit me at http://www.thebusinessandmanagementcoach.co.uk)

Phasing out the DRA presents one of the biggest social and economic challenges in a lifetime. Getting it right is critical.

In just over a year’s time thousands of men and women will find themselves reaching a point where, throughout their entire life, they expected to find a milestone. They will find it gone; compulsory retirement is no more. Many will grasp this opportunity; some may feel differently.

One thing is certain; those who continue to work past what was their expected retirement date will be doing so for many varied reasons. Some will be motivated because they love their work; others may be driven by concern over financial insecurity. There will be as many, often complex, reasons as there are people involved.

One thing is sure. Employers and their employees who chose to carry on working will need to think through exactly how their extended working relationship is going to be of mutual benefit.

Thousands of workers will have paced themselves to finish at their retirement age. Suddenly the goalposts are not moved; they are gone.

Planning this ‘extra time’ will be vital. Businesses that have paid little regard to regularly reviewing and managing the performance of their people will need to think again.

It is essential that the working relationship includes opportunities for continuous personal and professional development. If a manager opts to work for an extra five or ten years, the impact on their team will be significant.

Historically the training and development of managers has tended to tail off as they approach retirement. All this must change. Employers won’t want passengers and few employees will want to stay on without achieving real job satisfaction.

The pressure which often accompanies management positions will need to be monitored. Employment law makes employers responsible for the health, safety and welfare of their employees. Employers allowing stress to adversely affect the health of their employees, and do nothing about it, can find themselves in hot water.

Like it or not, for most of us, the process of learning and adapting to change become more challenging as we age. Health issues become highlighted. Employers must be able to show they have identified possible problems areas, are monitoring situations and have plans in place to address any issues that may arise.

For the vast majority, working past the compulsory retirement age will be welcome. People are fitter longer, and the enjoyment many get from working might even reduce the numbers in doctor’s waiting rooms.

But employers should review policies and procedures now and not wait until they find themselves in uncharted waters.