THE CHALLENGE An employee is nearing or past retirement age but wants to
carry on working. Is he entitled to continue his employment or is the company
justified in serving him with compulsory retirement? Charlotte Hamer and Paul
White, of the Employment and Pensions Group at Stephenson Harwood, weigh up the
issues.
In November 2001, the NHS compulsorily retired the leading heart surgeon Sir
Magdi Yacoub at the age of 66 because of its guidelines on age. Despite the
objections of Sir Magdi’s colleagues and patients at Harefield Hospital, he had
to retire.
The only reason he was retired was because of his age, which is clearly
discrimination. Discrimination on the grounds of age is not, however, unlawful
in this country. But all this is about to change.
Legal issues
There have recently been a few attempts to prevent discrimination on the
grounds of age, albeit using the existing sex discrimination legislation.
The first was the case of Nash v Mash/Roe Group Ltd, 1998, IRLR 168. Nash
successfully claimed that section 109 of the Employment Rights Act 1996 (ERA),
which prevents an employee over the normal retiring age from claiming unfair
dismissal, was indirectly discriminatory on the grounds of sex.
Nash claimed 67 per cent of those working over the normal retirement age
were men and therefore the provision had a disproportionate effect on men
compared to women.
In Harvest Town Circle Ltd v Rutherford, 2001, IRLR 599, Rutherford claimed
unfair dismissal and a redundancy payment when he was made redundant at the age
of 67.
He was also successful at the tribunal in arguing that the provisions in the
ERA were indirectly discriminatory and incapable of objective justification.
The EAT overturned the decision, but left open the possibility of such a
claim succeeding because the decision was remitted to a fresh tribunal.
The EAT said the statistics used did not make up the whole picture. They did
not include those who would have continued working past the normal retiring age
but were dismissed or resigned because of the age provisions.
In 2000, the EU passed the general framework directive that prohibits
discrimination on the grounds of religion or belief, sexual orientation,
disability and age. Laws prohibiting discrimination for religion or belief or
sexual orientation must be implemented by December 2003.
A further three years is allowed for implementation of disability and age
discrimination legislation.
On 13 December, in preparation for the substantial revision of
discrimination legislation, the Government issued a consultation paper.
The UK is already comparatively sophisticated in its level of discrimination
protection. While religious discrimination is not prohibited as such, there
have been a number of claims where the Race Relations Act has been effective in
preventing some religious discrimination.
The question of what constitutes a "belief" (which will be wider
than recognised religions) may prove more contentious.
Disability discrimination legislation already exists and is unlikely to be
altered much. While there have been a couple of high profile cases on sexual
orientation discrimination, the introduction of legislation prohibiting it is
unlikely to have a significant impact in practice.
However, age discrimination occurs in the majority of businesses. This may
be due to the existence of compulsory retirement ages or the requirement for a
certain level of experience for recruitment or promotion.
The introduction of age discrimination legislation will have a substantial
impact because the process will require all employers to evaluate how they
treat employees from "cradle to grave".
Of course, some of the policies which are prima facie discriminatory will be
capable of objective justification. For example, in Sir Magdi’s case, the NHS
would be likely to be able to justify its guidelines on the grounds of the
protection of patients. Such justification is permitted by the directive.
Some policies, however, may not be so justifiable. It is important to
remember that these measures will apply to both ends of the age spectrum.
HR issues
While there is no need to panic, there is no room for complacency. For many
businesses the "discriminatory" practices or culture may be institutional.
Implementing the proposals may be like turning round an ocean liner – something
not to be done in a three-point turn.
Businesses should therefore:
– Look at existing practices to consider which may be discriminatory
– Consider which, if any, are capable of objective justification
– Not rush to amend any policies at this stage as the Government may discard
a number of the options proposed, but consider what is and is not necessary for
the business
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– Consider the existing Code of Practice on age discrimination for an
indication of recent Government thinking
Charlotte Hamer is the professional support lawyer and Paul White is a
senior associate in the Employment and Pensions Group at Stephenson Harwood
