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Age Discrimination Update: New Severance & Retirement Arrangements
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Date: 25th Jul 2006
New legislation comes into effect on the 1st October 2006 that will make illegal different treatment on the grounds of age. This will have a number of significant implications for terms and conditions most notably the right to continue working beyond age 60 and on severance and retirement arrangements.
Extensive negotiations with the Bank are now complete and the Union’s Executive Committee will shortly be considering the proposals.
The main changes can be summarised as follows:
- from 1st October 2006 staff will automatically have the right to continue working on the same terms and conditions until age 65 and to continue to accrue pensionable service and benefits up to that age
- however, the age at which pensions can be paid without an actuarial reduction (designed to take account of early payment) will remain 60
- new severance terms will replace all existing arrangements and will be based on the statutory redundancy terms multiplied by a factor of 4
- for legal reasons early retirement from age 50 on non-actuarially reduced pensions will no longer be possible
- from 1st January 2007 new flexible retirement options will be introduced and will mean that staff working beyond age 55 can choose to take some or all of their pension (minimum 50%) whilst continuing to work.
These changes apply to all staff on UK contracts. Separate negotiations will be required for staff working Offshore due to the different legislation that applies in those areas.
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