Monday, August 21, 2006
[IWS] Mercer: UK Company Health Plans--Potential Discrimination Claims [21 August 2006]
IWS Documented News Service
_______________________________
Institute for Workplace Studies----------------- Professor Samuel B. Bacharach
School of Industrial & Labor Relations-------- Director, Institute for Workplace Studies
Cornell University
16 East 34th Street, 4th floor---------------------- Stuart Basefsky
New York, NY 10016 -------------------------------Director, IWS News Bureau
________________________________________________________________________
Mercer (UK)
UK company health plans - potential minefield for discrimination claims
UK
London, 21 August 2006
http://www.mercerhr.com/pressrelease/details.jhtml/dynamic/idContent/1238460
Companies could face costly age discrimination claims if they do not review their health and benefit plans soon, warns Mercer Human Resource Consulting. Age discrimination legislation comes into effect this October, and employers that provide benefits like private medical cover, income protection and life insurance could be taken to an employment tribunal if they continue to use age-related rules in their policies.
The Government has not issued any guidance to help companies ensure their health benefits are compliant with the new rules, so employers will have to assess their plans thoroughly and look for potential 'black spots'. Where age-related rules apply, they will have to be able to justify why they are included in their policies.
John Matthews, Principal at Mercer, commented: "The Government has been extremely unhelpful and left employers in the dark about how their health and benefit plans could contravene new age discrimination regulations. There are numerous areas where companies could trip up - the only way they can stave off potential claims is by conducting a thorough review of their benefit plans."
Companies with flexible benefit arrangements are particularly at risk. Through these arrangements they tend to charge employees for benefits based on their age, or use some form of age banding. For example, a 20 year-old will typically pay much less for life insurance through a flexible benefits scheme than, say, a 50 year-old. This may prove to be problematic under the new regulations.
Income protection is another area where employers could be in danger of breaking the rules because it tends to be linked to pension scheme membership, which is frequently restricted by age. While certain aspects of pension scheme arrangements are exempt from age discrimination rules, income protection plans are not. Therefore, companies may face claims if they refuse to provide income protection to employees because they are too young to join the occupational pension scheme.
"Companies need to anticipate what employment tribunals will consider to be discriminatory and look for potential trouble spots in their benefit provision. They may then need to adapt their policies or take out additional cover to protect themselves," said Mr Matthews. "Though it may be expensive for employers to take action to ensure their health plans are compliant, it will be far less costly than a string of damaging discrimination claims."
______________________________
This information is provided to subscribers, friends, faculty, students and alumni of the School of Industrial & Labor Relations (ILR). It is a service of the Institute for Workplace Studies (IWS) in New York City. Stuart Basefsky is responsible for the selection of the contents which is intended to keep researchers, companies, workers, and governments aware of the latest information related to ILR disciplines as it becomes available for the purposes of research, understanding and debate. The content does not reflect the opinions or positions of Cornell University, the School of Industrial & Labor Relations, or that of Mr. Basefsky and should not be construed as such. The service is unique in that it provides the original source documentation, via links, behind the news and research of the day. Use of the information provided is unrestricted. However, it is requested that users acknowledge that the information was found via the IWS Documented News Service.
Stuart Basefsky
Director, IWS News Bureau
Institute for Workplace Studies
Cornell/ILR School
16 E. 34th Street, 4th Floor
New York, NY 10016
Telephone: (607) 255-2703
Fax: (607) 255-9641
E-mail: smb6@cornell.edu
****************************************
_______________________________
Institute for Workplace Studies----------------- Professor Samuel B. Bacharach
School of Industrial & Labor Relations-------- Director, Institute for Workplace Studies
Cornell University
16 East 34th Street, 4th floor---------------------- Stuart Basefsky
New York, NY 10016 -------------------------------Director, IWS News Bureau
________________________________________________________________________
Mercer (UK)
UK company health plans - potential minefield for discrimination claims
UK
London, 21 August 2006
http://www.mercerhr.com/pressrelease/details.jhtml/dynamic/idContent/1238460
Companies could face costly age discrimination claims if they do not review their health and benefit plans soon, warns Mercer Human Resource Consulting. Age discrimination legislation comes into effect this October, and employers that provide benefits like private medical cover, income protection and life insurance could be taken to an employment tribunal if they continue to use age-related rules in their policies.
The Government has not issued any guidance to help companies ensure their health benefits are compliant with the new rules, so employers will have to assess their plans thoroughly and look for potential 'black spots'. Where age-related rules apply, they will have to be able to justify why they are included in their policies.
John Matthews, Principal at Mercer, commented: "The Government has been extremely unhelpful and left employers in the dark about how their health and benefit plans could contravene new age discrimination regulations. There are numerous areas where companies could trip up - the only way they can stave off potential claims is by conducting a thorough review of their benefit plans."
Companies with flexible benefit arrangements are particularly at risk. Through these arrangements they tend to charge employees for benefits based on their age, or use some form of age banding. For example, a 20 year-old will typically pay much less for life insurance through a flexible benefits scheme than, say, a 50 year-old. This may prove to be problematic under the new regulations.
Income protection is another area where employers could be in danger of breaking the rules because it tends to be linked to pension scheme membership, which is frequently restricted by age. While certain aspects of pension scheme arrangements are exempt from age discrimination rules, income protection plans are not. Therefore, companies may face claims if they refuse to provide income protection to employees because they are too young to join the occupational pension scheme.
"Companies need to anticipate what employment tribunals will consider to be discriminatory and look for potential trouble spots in their benefit provision. They may then need to adapt their policies or take out additional cover to protect themselves," said Mr Matthews. "Though it may be expensive for employers to take action to ensure their health plans are compliant, it will be far less costly than a string of damaging discrimination claims."
______________________________
This information is provided to subscribers, friends, faculty, students and alumni of the School of Industrial & Labor Relations (ILR). It is a service of the Institute for Workplace Studies (IWS) in New York City. Stuart Basefsky is responsible for the selection of the contents which is intended to keep researchers, companies, workers, and governments aware of the latest information related to ILR disciplines as it becomes available for the purposes of research, understanding and debate. The content does not reflect the opinions or positions of Cornell University, the School of Industrial & Labor Relations, or that of Mr. Basefsky and should not be construed as such. The service is unique in that it provides the original source documentation, via links, behind the news and research of the day. Use of the information provided is unrestricted. However, it is requested that users acknowledge that the information was found via the IWS Documented News Service.
Stuart Basefsky
Director, IWS News Bureau
Institute for Workplace Studies
Cornell/ILR School
16 E. 34th Street, 4th Floor
New York, NY 10016
Telephone: (607) 255-2703
Fax: (607) 255-9641
E-mail: smb6@cornell.edu
****************************************
# posted by SBasefsky : 7:58 AM
