Usefully Employed

By way of reminder, the UK’s age discrimination legislation is found in both the Employment Equality (Age) Regulations 2006, and their link with the retirement provision in the Employment Rights Act 1996.

Before the regulations, a company could ‘retire’ a (usually) 65 year old employee simply by virtue of the fact that the employee lost his unfair dismissal rights at that age. The regulations introduced fairly wide ranging discrimination laws, but retained this right to retire. It did this by introducing retirement as a statutory concept. Those over 65 now have the same right to claim unfair dimissal as any other employee, save that ‘retirement’ was added to the list of potentially fair reasons, eg conduct, capability and so on, under s98 ERtsA 1996.

A retirement dismissal is accomplished simply by following a statutory procedure, which in effect is giving the employee six months notice and hearing any request to continue working beyond the retirement date. The net effect, however, is that provided the procedure is followed a 65 year old employee can be fairly dismissed solely on that basis. I have made my views about this clear here.

Heyday, which is in fact Age Concern, campaigned hard against the retention of compulsory retirement. They persuaded the High Court to refer a question to the ECJ as to whether or not this provision offended against Council Directive 2000/78/EC, the European legislation which outlaws age discrimination. Things started to look shaky for Heyday’s challenge in case of Palacios v Cortefiel Servicios SA, which found that compulsory retirement provisions in Spain were justified - there the retirement age was linked in with entitlement to state benefits however, meaning the Spanish government had greater scope to plead sound economic and social benefits of the legislation.

The Advocate General assigned to the case has released his opinion, and AG’s opinions are normally followed by the full court. His conclusions are:

Article 6(1) of Directive 2000/78 permits Member States to introduce legislation providing that a difference of treatment on grounds of age does not constitute discrimination if it is determined to be a proportionate means of meeting a legitimate aim within the meaning of Article 6(1). It does not, however, require Member States to define the kinds of differences of treatment which may be justified under Article 6(1) by means of a list or other measure which is similar in form and content to the list in Article 6(1);

A rule such as that at issue in the main proceedings, which permits employers to dismiss employees aged 65 or over if the reason for dismissal is retirement, can in principle be justified under Article 6(1) of Directive 2000/78 if that rule is objectively and reasonably justified in the context of national law by a legitimate aim relating to employment policy and the labour market and it is not apparent that the means put in place to achieve that aim of public interest are inappropriate and unnecessary for the purpose.

Note the ‘in principle’ - under the way this reference has been phrased, the decision now rests with the domestic court as to everything that follows ‘if that rule’ in the second paragraph. The matter will thus return to the High Court for those matters to be determined.  So it’s not over yet!

The AG’s full opinion can be read here. If you’ve ever wondered who these people are then you can read a potted bio of Mazak here.