JLT warns businesses north of border to develop strategy now

A third of employers in Scotland have not yet reviewed or are planning to review their reward strategy to meet the needs of an older workforce, it was suggested today.

A survey for the employee benefit consultancy arm of JLT also found that half of businesses north of the border have not decided how they will adapt to an older employee workforce.

The findings, from the second survey of the "JLT 250 Club" which looks primarily at pension arrangements, have "worrying" implications for a number of other employee benefits, JLT said, given the recent abolition of the default retirement age.

Malcolm Paul, chairman of JLT Benefit Solutions in Scotland, said that all businesses need to decide how they will respond to an open-ended workplace where employees will often be able to work for as long as they are willing and able to do so.

He said: "It is therefore concerning to see our research indicating that, compared with their counterparts in England, Scottish employers appear less certain of, and therefore able to adapt to, an aging employee workforce."

Scottish employers need to give consideration to the employee benefits that they will provide to their workers who continue in service after normal pension age, Paul added.

He said: "Organisations need a policy on the inevitable increase in demand for flexible retirement and the future role of pensions and other benefits in succession planning."

Paul highlighted the "immediate" concern of workers in the 60 to 64 age group, where there are 131,838 such individuals in Scotland.

"This cohort may not retire when employers expect them to and organisations need a policy on how they will react to this reality," Paul said.

Latest data from the Office for National Statistics shows the average retirement age for men and women has been steadily rising across the UK over the past decade.

The average retirement age rose by one year between 2004 and 2010, bringing the age at which men stop working in line with the state pension for the first time in 26 years.

The average retirement age for men has risen from 63.8 years seven years ago to 64.6 years in 2010.