BAD luck old timer. You can kiss goodbye to the gold watch. As an unintentional by-product of new European legislation aiming to outlaw age discrimination, all perks and rewards for loyalty and long service may become illegal.

The reason, they say, is that younger employees would be able to claim that these were privileges that they were unjustly denied because they were simply not old enough to have earned them.

Some employers worry that even throwing a party to celebrate a staff member’s 25 years of service could raise objections. Other benefits, including extra holiday entitlement or free medical insurance offered after five or so years of service, are also seen as under threat from the directive, which is due in 2006.

Although the Government has indicated that companies should be able to retain benefits such as these, provided they can justify them, employers are still concerned.

“Length of service policies . . . are thought to improve retention, staff morale, and enable the organisation to position itself as a ‘good’ employer,” said Sam Mercer of the Employers Forum on Age. “But most of our members believe it would be impossible to provide substantive ‘proof’ that the majority of these policies actually deliver.” Rather than risk being challenged by younger employees, it is likely that companies will simply withdraw the benefits altogether, she said.

Becky Mason, of BT, said that the directive could create an employee relations nightmare if employers withdrew certain benefits. She added that for the sake of workable legislation, the Government should provide a general exemption on length of service.

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