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Age discrimination and retirement age – where are we now?

Wednesday, July 5, 2017

The UK abolished its 'default' retirement age over 6 years ago, leaving workers free to retire at any time and draw any occupational pension they are entitled to at that point. However, some organisations continue to maintain a 'retirement age' - so how does that fit with the provisions of the Equality Act 2010 and age discrimination.

 

Age is a protected characteristic

The Equality Act 2010 sets out 9 'protected characteristics' including age. The protection each of these characteristics is afforded under the Act varies slightly. As far as age is concerned, the Act protects against direct and indirect discrimination, harassment and victimisation.

 

Direct discrimination can be objectively justified

Unlike the other 8 protected characteristics, it is possible to justify direct discrimination on grounds of age. If an employer can show that the discrimination is a proportionate means of achieving a legitimate aim, it will not be unlawful.

 

Selsdon v Clarkson, Wright and Jakes

Although this case concerned a partnership rather than an employment relationship, it provides a thorough analysis of the factors the courts will consider in looking at whether direct discrimination on grounds of age can be objectively justified.

Selsdon was an equity partner in a firm of solicitors. He was retired at 65 in accordance with the terms of the partnership deed he had signed. He brought a claim of age discrimination, which went all the way to the Supreme Court on the question of objective justification. The respondent firm stated that the retirement age was underpinned by aims of recruitment and retention, workforce planning and collegiality. The ET agreed, but on Selsdon's appeal, the EAT questioned the validity of 'collegiality' as a justification. The EAT could not be sure the ET would have decided the case in the same way if collegiality was removed, and remitted it back to the ET to reconsider. Mr Selsdon appealed to the Court of Appeal and ultimately the Supreme Court but was unsuccessful. The case eventually went back to the ET, which decided that the mandatory retirement age could be justified on the grounds of the 2 remaining aims (without collegiality). It also decided that 65 was justified as the retirement age, partly because it was the age that had been agreed in the partnership deed, and because it was the default retirement age for the firm's employees. Mr Selsdon appealed this to the EAT but was unsuccessful.

The case provides a helpful analysis of what would be a proportionate means of achieving a legitimate aim when seeking to justify a default retirement age. The Supreme Court clarified that the legitimate aim (or aims) had to be in the public interest, not just specific to the organisation seeking to rely on it. It also held that work force planning and recruitment and retention were aims that facilitated inter-generational fairness and dignity which were permissible objectives and their status as permissible objectives had already been confirmed by the Court of the Justice of the European Union.

 

The latest from the CJEU on retirement ages and age discrimination

The latest decision from the CJEU concerns not so much 'retirement' as an upper age limit - of 65 - by employees  flying commercial aircraft, an age limit which is prescribed  by the EU Regulation on Civil Aviation Aircrew., The Advocate General has recently had to consider whether this Regulation was compatible with provisions in the EU Charter of Fundamental Rights which safeguards the right to engage in work and purse a freely chosen occupation (article 15), and protects against age discrimination (article 21).

In Fries v Lufthansa CityLine GmbH C-190/16, Mr Fries brought a claim for the 2 months' pay he should have received if his employment as a pilot had terminated 2 months after his 65th birthday in accordance with the relevant collective agreement, and not on his 65th birthday, when Lufthansa dismissed him. Lufthansa relied on the Regulation; Mr Fries argued he could have carried out alternative duties for the remaining 2 months - for example training others.

 

Compatibility of the Regulation with the EU Charter

The CJEU was asked to consider the compatibility of the Regulation with articles 15 and 21 of the Charter, and whether 'Alternative Duties' as suggested by Mr Fries would fall within Commercial Air Transport.

The Advocate General has delivered an opinion which supports Lufthansa's view that  the age limitation on flying commercial aircraft is valid. He accepted the idea that 'genuine occupational requirements' could apply to article 21 of the EU Charter. In a safety critical role such as that of a pilot, an age restriction like this could be justified, and the objective of maintaining air traffic safety was legitimate and appropriate. However, the Advocate General did not agree that 'alternative duties' was covered by 'commercial air transport'. He considered that Mr Fries should have been allowed to continue to work as long he was not physically flying commercial aircraft.

 

Application in the UK

The Fries case raises interesting points of law relating to the interpretation of the EU Charter and the role of the Equal Treatment Directive in clarifying the EU Charter's non-discrimination principle. For UK employment lawyers, the AG's opinion is a reminder of the principles involved in looking at direct discrimination on grounds of age, and whether the discrimination can be objectively justified. We also need to remember that although the CJEU tends to follow the opinion of the Advocate General, the final decision may be more nuanced.

  • To maintain a retirement age, employers must be able to show that it can be objectively justified
  • Objective justification involves demonstrating that the retirement age is a 'proportionate means of achieving a legitimate aim'
  • A 'legitimate aim' must be in the public interest - not just in the interests of the organisation imposing the retirement age

 

Get in touch if you're worried about age discrimination - either as an employer or employee

We regularly advise employers and employees on discrimination issues, including age discrimination. Please get in touch if you have any questions about retirement age and the impact of age discrimination rules, or if you would like to discuss anything arising from this blog.

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