Recent employment tribunal rulings are a reminder that even the largest employers can make costly mistakes. Making it compulsory for employees to retire at a certain age is, in principle, direct age discrimination – any compulsory retirement age imposed must be objectively justified.
The employment tribunal recently found that the Ministry of Defence (MoD) discriminated against an employee in his sixties who “was in a situation where he had raised a grievance and was very concerned about his employment”. The tribunal found that “suggesting that someone retires and leaves is not a solution to the subject matter of the grievance, it is a means of removing the aggrieved person from the problem”.
Employers can be found to discriminate on the basis of age both directly and indirectly. Direct discrimination occurs when a person is treated less favourably due to their age without objective justification. Indirect discrimination occurs when an employer has a provision, criterion or practice that has a greater adverse impact on employees in one age group than those in another, which is not objectively justified.
To successfully argue objective justification, employers need to show their actions are a proportionate means of achieving a legitimate aim, such as a real business need. In the above case, the MoD argued that its actions were justified by its “need to effectively manage staff and ensure effective succession planning”. The tribunal held that for someone “seeking reassurance that their position and employment is safe, it is not reasonably necessary and therefore proportionate” to ask if the employee is considering leaving.
If an employer operates a fixed retirement age, it must show that the retirement dismissal of each employee at that age amounts to a fair reason for dismissing the employee and it must follow fair procedures. This includes giving employees adequate notice of potential retirement, ensuring all employees are made aware of the fixed retirement age and checking that those approaching that age are aware of the policy and its implications. Where appropriate, consideration should also be given to any request by the employee to stay beyond the fixed retirement age.
Employers should also be mindful that the risk of disability increases with age. In a recent case involving an Asda worker in her seventies who suffered from dementia, the employment tribunal considered a workplace incident where “the [employee] had had difficulty finding her keys and bus pass” and, to assist, a manager rummaged in her bag and found the items for her.
The tribunal found that this was “done with the best intentions and to genuinely assist the [employee]” but that it was “disability-related harassment” because it “had the effect of violating her dignity, having been done without her consent”. The tribunal also found that the worker “was treated unfavourably in that she was asked on more than one occasion to retire” and was constructively dismissed through conduct amounting to “age and disability-related harassment, direct age discrimination and discrimination arising from disability”.
Employers should help employees to make the transition to retirement by offering pre-retirement training to employees, to help them prepare for the financial and personal changes it brings. They should discuss options like flexible or part-time working in the lead up to retirement to ease the transition. This could include options such as job sharing, changing roles, or getting more experienced staff to pass on expertise by mentoring younger employees.
Nelu Abeygunasekera is a partner and specialist employment lawyer at Excello Law