Background

As many of you will be aware, despite the many difficulties for employers arising from the introduction of the Age Discrimination Regulations in 2006, the Government did provide an opt-out for employers to continue to retire employees at the age of 65, provided they followed a retirement procedure.

This was a concession to the business community who pointed out the many and varied advantages of retiring employees at 65. Not least amongst these was the fact that, as people got older, they were increasingly prone to be problematic in terms of reliability and health.  It was argued persuasively that without some form of compulsory retirement employers could be involved in very difficult conversations with employees about their continued suitability for their jobs. In that way of the golden pocket watch at 65 held a certain dignity and simplicity for employers and employees. There was always the option to re-employ after 65 in any event and not face unfair dismissal claims. Those were the days...

Since 2006 unfair dismissal rights continue after 65 but can be avoided by employers retiring employees at or over 65 if they follow the government’s procedures. The compulsory retirement age and the retirement procedures introduced by the 2006 Regulations however are, on the face of it, discriminatory.

The National Council on Ageing which operates under the names of Heyday and Age Concern sought a judicial review of the Regulations and brought the case to the ECJ.  It argued that by allowing compulsory retirement at 65 the Government had failed adequately to implement European Equal Treatment Framework Directive.

Decision

The ECJ has effectively found that the Government has not breached the Directive - but has gone on to find that, since the compulsory retirement age that the Government introduced directly discriminates on the grounds of age, article 6(1) of the Directive requires that it must be “justified by legitimate social policy objectives such as those related to employment policy, the labour market or vocational training”.

What the ECJ did not decide was whether the provisions allowing for compulsory retirement are, in fact, justified. Instead it has sent the matter back to the High Court in the United Kingdom to consider the matter. The next step is therefore that the Government will have to prove in the High Court that the procedures are “justified” under the legislation - which means they must show that it had a legitimate aim in introducing the compulsory retirement age and that the means used to achieve that legitimate aim were appropriate and necessary.

It has been said that the Government will need a high burden of proof at the High Court to demonstrate that the policy was justified. Some cynical lawyers however think that the High Court will find it difficult not to uphold the Government’s procedures, provided a strong case can be provided by the Government, particularly given the headaches and further litigation if the Government’s procedures were to be held to be in breach of the European Regulations. Watch this space.