Redundancy pay could be the same for all age groups

At present, employees aged 41 and above must be paid at least a week and a half's salary for every year of service above the age of 41 with their employer.

Workers under the age of 41 receive just one weeks pay for each year of service.

Under the new proposals, payments to all workers would be equalised at the current rate for workers under the age of 41.

High unemployment

The proposal is part of the governments move to enshrine the 2000 EU employment directive into UK law.

A recent survey from Mercer Human Resources showed that average redundancy pay for UK workers was amongst the lowest throughout the EU.

UK employees being made redundant can expect to receive only one-fifth the sum paid to workers in Spain.

Only workers in France and the Netherlands receive less money than UK employees.

What is more, charities argue that older workers need enhanced redundancy pay as they often find it harder to find employment.

According to the Office for National Statistics (ONS) a third of the UK population will be over 50 by 2020.