It has been nearly 10 years since the introduction of age discrimination legislation into UK domestic law. This article from Andrew Smith of Matrix Chambers reflects on some of the age discrimination disputes that have come before the UK Tribunals and Courts, and considers some of the practical challenges facing employers in the future, in light of the changing demographics of the UK workforce and related political and social issues.
We are fast approaching the 10 year anniversary of the introduction into UK domestic law of specific age discrimination legislation in the field of employment law, originally via the Employment Equality (Age) Regulations 2006 and superseded by the Equality Act 2010. October 2016 will also represent the five year anniversary of the abolition by the UK government of the default retirement age (the “DRA”).
This article reflects on some of the age discrimination disputes that have come before the UK Tribunals and Courts, and considers some of the practical challenges facing employers in the future, in light of the changing demographics of the UK workforce and related political and social issues.
It is well understood that direct age discrimination is the only form of direct discrimination that may be justified – i.e. an employer will have a valid defence if it can establish that any less favourable treatment of a worker of a particular age (or within a particular age group), because of their age, is a proportionate means of achieving a legitimate aim. The reason for this exemption from the general rule that direct discrimination may never be justified reflects the particular social policy issues in play in the context of age discrimination. In Seldon v Clarkson Wright & Jakes  IRLR 590, Lord Hope commented (at paragraph 73):
“There is a public interest in facilitating and promoting employment for young people, planning the recruitment and departure of staff and the sharing out of opportunities for advancement in a balanced manner according to age. These social policy objectives have private aspects to them, as they will tend to work to the employer's advantage. But the point is that there is a public interest in the achievement of these aims too. They are likely to be intimately connected with what employers do to advance the interests of their own businesses, because that it how the real world operates. It is the fact that their aims can be seen to reflect the balance between the differing but legitimate interests of the various interest groups within society that makes them legitimate.”
This ‘balancing exercise’ is far from straightforward and can present employers with significant challenges in terms of ensuring that their policies and practices are tailored to their particular needs and circumstances, whilst at the same time complying with age discrimination legislation.
The abolition of the DRA did not abolish an employer’s right to operate a compulsory retirement age (“CRA”); however, as a matter of practical reality, many employers reacted to this change in the law by ceasing to apply any defined retirement ‘trigger point’. What is unclear is whether employers adopted this course of action out of a fear of being deemed to fall foul of the amended age discrimination provisions (should they persist with a CRA), or because they took a conscious decision that operating a case by case retirement policy would be in the best interests of the business, over the short, medium and/or long term.
Over the past few years Employment Tribunals and Courts have provided helpful guidance regarding:
- The legitimate aims which an employer may rely on in order to justify the application of a CRA or another policy that is prima facie discriminatory on grounds of age;
- The factual matters which an employer may need to prove, in order to establish the proportionality (and therefore lawfulness) of such a policy; and
- The type of evidence that may need to be adduced in order to substantiate (a) and (b) above.
The concept of ‘inter-generational fairness’ in the employment context has perhaps taken on added significance following the result of the EU referendum; more specifically, the reported trend of a ‘generational divide’ in attitudes towards the UK’s membership of the EU. The full economic and political consequences of the referendum result remain to be seen. However, having regard to the legitimate public interest of “facilitating and promoting employment for young people, planning the recruitment and departure of staff and the sharing out of opportunities for advancement in a balanced manner according to age” (per Lord Hope in Seldon), it will be interesting to see whether there is a renewed interest on the part of employers in the establishment and application of CRAs to particular roles or parts of their workforce.
Another potentially contentious issue is the extent to which exemptions from the general principles of unlawful age discrimination should continue to apply in the sphere of occupational pensions, having regard to any long-term damage that is sustained by the UK economy as a consequence of the referendum result and the financial burden that the existing pension arrangements may place on younger workers.
In terms of practical challenges for employers and their HR departments as they move forward into an era in which workers are expected to work until they are significantly older than before, it is important to consider whether existing policies and procedures provide sufficient guidance to managers regarding, for example:
- The application of capability and performance management procedures to workers who may be experiencing difficulties associated with age;
- The inter-relationship between performance management procedures and the management of ill-heath and/or disability (including the obligation to make reasonable adjustments), which may be connected with a worker’s age;
- Processes for understanding the objectives and wishes of older workers, as they enter the latter stages of their career;
- The assessment and resolution of flexible working requests, which may be influenced by a worker’s age; and
- How requests for early retirement will be assessed and determined.
Demographic shifts in society inevitably present a significant challenge for governments and employers alike. It remains to be seen whether, when workers, employers, politicians and lawyers come to reassess the position in 10 years’ time, there is any form of consensus that an appropriate ‘balance’ has been struck.
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