Mr Plewes worked for Adams Pork Produce as a production operative. His contract of employment provided that the normal retirement date for all employees was the day before the employee’s 65th birthday. When Adams notified Plewes that he would be required to retire in accordance with his contract he made a request to continue working beyond retirement age. This request was rejected and Plewes submitted an appeal which was unsuccessful. Plewes was retired on 29 December 2006, the day before his 65th birthday. On 15 January 2007, he was re-engaged in his old job via an agency and on a lower salary. Plewes issued employment tribunal proceedings claiming his dismissal was both unfair and discriminatory on grounds of age.
Age discrimination legislation provides that an employer does not discriminate against an employee by dismissing them for retirement at or over the age of 65. Such a dismissal will be a fair dismissal where the retirement procedure set out in the legislation is followed. Where an employee is retired before reaching age 65, the lower retirement age must be objectively justified to avoid an age discrimination claim. In such cases, the statutory dismissal procedure should be followed and the retirement procedure in the age discrimination legislation does not apply.
The employment tribunal decided that Plewes’ dismissal was unfair and that he had been subject to unlawful age discrimination. His employment contract made quite clear that his retirement age was below age 65 (ie 64 and 364 days). As such, the default retirement provisions of the age legislation permitting retirement at or over age 65 did not apply. Adams were unable to objectively justify the lower retirement age and had failed to follow the statutory dismissal procedure. Compensation of more than £36,000 was awarded which included £7,500 for injury to feelings and a 50% uplift to the compensatory award to reflect the employer’s failure to follow the statutory dismissal procedure.
This decision provides a salutary lesson for employers and demonstrates the unforgiving nature of employment tribunal proceedings. Adams appears to have had a genuine belief that the retirement age which applied to Plewes was 65 and it had, therefore, followed the retirement procedure set out in the age legislation. Given the clear wording of the employment contract, this belief was mistaken. When assessing compensation, however, the tribunal took no account of the fact that Adams had acted mistakenly rather than having deliberately flouted the law.
In many organisations it is common practice for a retiring employee’s last working day to be the day before they reach their 65th birthday. These employers should avoid falling into the trap highlighted by this case and ensure that, whatever the last working day, the employment does not actually end until the day on which the employee becomes 65.
Louise Hendry, associate, DLA Piper