The CBI is calling on the Government to reassure employers who are worried about the changes which outlaw staff being forced into retirement at 65 from April 6.
Employers must be able to ask their staff when they plan to retire as part of routine succession planning without the threat of being accused of ageism, the CBI said.
Jim Bligh, policy adviser at the CBI, told The Sunday Telegraph that in the business group's Budget submission due to be published tomorrow, the body was calling on the Government to bring in so-called "protected conversations", so that employers could openly raise retirement with staff without being sued.
Under next month's changes, any employer questioning an older member of staff about when they plan to stop working is at risk of appearing discriminatory.
Employers will no longer be allowed to retire staff automatically when they reach 65, but businesses are in the dark over how they can approach the subject without causing legal problems and staff stress and resentment.
Mr Bligh said the protected conversation would be a "formal" process where an individual sits down with their line manager and potentially a member of human resources and a trade union representative to disclose whether they are thinking of retiring and when. The process would need primary legislation and could be included in the Government's forthcoming Employment Bill, he said.
He argued: "This idea would help employers plan. It would give employers a space to discuss retirement with their employees without the risk of age discrimination claims."
Mr Bligh added that the majority of employers would rather not see the right to retire staff scrapped but were resigned to the new legislation. The onus was now on the Government to make the changes workable, he said, rather than cause costly tribunal claims for employers trying to focus on growth.
In its Budget submission, the CBI will also call for the Government to spell out how companies can use "objective" justification to retire a worker, Mr Bligh said. Examples commonly used are police officers and airline pilots, where it is generally accepted that they should retire at a fixed age.
The British Chambers of Commerce and manufacturing body the EEF have also urged the Government to clarify the new retirement rules.
In a letter to The Sunday Telegraph, the two groups criticised the Government's handling of the regulations, which have had to be amended to correct errors. The letter said: "For individual employers, the effect has been substantial, with many having already taken legal advice and changed their policies, only to find these expensive new rules were rendered unlawful by inaccurate regulation."
On Friday, conciliation service Acas published new employer guidance on the changes.
A Department for Business spokesman said: "Acas has produced guidance for businesses that explains how they can deal with the retirement of their staff. This makes clear that discussions between the two parties can and should be open, honest and frank. It gives clear examples to business in how to follow this advice and provides the necessary clarity needed when operating without the DRA [default retirement age]."
Article from The Telegraph