Employers not explaining DRA-removal to older workers

According to the Jelf Employee Benefits Survey less than a third (29%) of older workers have been formally told about their right to continue working past the former default retirement age (DRA).

Half only became aware of this right due to media coverage.

One in five employers said they restricted benefits eligibility for staff older than 65, with a similar number confirming they did not explicitly tell employees about this.

However, 43% of employers were not aware of their insurers' maximum age limits for group risk employee benefits.

Jelf highlighted that there was no explicit employer requirement to communicate the right to continue working or to continue to offer all benefits to older workers.

However it suggested that it should be expected that most organisations would have informed their entire workforce of this change in advance, and probably shortly after, the abolition of the Default Retirement Age.

"If such announcements were made by employers, it appears that they have not been made well," it said.

"The majority of employees - and in particular those older employees who are more immediately impacted by this change - have failed to understand the implications. It also raises questions as to whether employers have fully embraced the new legislative landscape, for instance by updating terms and conditions and contracts of employment."

Jelf Employee Benefits head of benefits strategy Steve Herbert added: "It is extremely concerning that three years on since the DRA was abolished, there is clearly some significant disparity in how this change is being managed by employers and communicated to employees.

"In a worst case scenario this could leave older employees vulnerable and under-insured, and/or employers effectively self-insuring the risk.

"The report findings suggest that many employers will need to urgently review their strategy and thinking around retirement issues."