The Employment Equality (Age) Regulations 2006 come into force
on 1 October 2006. The Regulations prohibit unjustified direct and
indirect age discrimination. They also make it unlawful to harass
or victimise on the grounds of age. It is important to note that
these prohibitions apply to the young and old alike.
The Regulations recognise that employers may sometimes have good
age-related reasons for treating employees differently. Difference
in treatment is therefore deemed to be justified if it is a
"proportionate means of achieving a legitimate aim".
Guidance published by the Department of Trade and Industry suggests
that, to be proportionate, the discriminatory effect of any
age-based practice will require to be significantly outweighed by
the importance and benefits of its legitimate aim and the employer
should have no reasonable alternative. Economic factors, such as
business needs and efficiency, may be legitimate aims but it will
not be enough by itself for an employer to argue that it would be
cheaper to discriminate.
What is the position if an employer wishes to reward long
serving employees with certain benefits, such as increased holiday
entitlement. Applying the basic principles of age discrimination,
such a practice would constitute indirect discrimination on the
basis that younger workers are less likely to have acquired the
length of service that would qualify them for the benefits. The
Regulations deal with this by expressly preserving an employer's
right to award benefits based on service of 5 years or less. So if,
for example, an employer has a scheme whereby, after 4 year's
service - employees get an extra couple of days holiday, there is
no question of that amounting to age discrimination. Where the
benefits are awarded on the basis of service of more than 5 years,
the practice would constitute discrimination unless it can be said
to fulfil a business need, such as encouraging loyalty or rewarding
experience
At present, there is an upper age limit for unfair dismissal and
redundancy rights. The Regulations remove that limit and, unless
there is a genuine retirement, older workers now have as much right
to claim unfair dismissal or to receive a redundancy payment as
younger workers. The upper age limits for Statutory Sick Pay,
Statutory Maternity Pay, Statutory Adoption Pay and Statutory
Paternity Pay are also removed.
It is in the area of retirement that the Regulations are at
their most novel. They introduce new retirement procedures that are
designed to enable a constructive dialogue between employees
wishing to continue working beyond retirement age and their
employers. They also impact on the law of unfair dismissal and it
is probably convenient to look first at that aspect of the
Regulations.
At present, there are five categories of fair reasons for
dismissing an employee. Those include conduct, capability and
redundancy. From October, there will be a sixth category, namely
retirement. The Regulations provide that, for retirement to be the
reason for dismissal, the dismissal must take place on or after the
date when the employee reaches the employer's normal retirement age
or, if the employer does not have a normal retirement age, the
default retirement age of 65. If the employee is dismissed before
that date, the reason for dismissal will not be retirement. If an
employer wishes to fix a normal retirement age below 65, that lower
age must be objectively justified or else it will constitute
discrimination.
Turning to the new retirement procedures, they provide that
employers must notify employees of their intended retirement date
not more than one year, but no less than six months, in advance. If
they do not, the employee may be entitled to compensation. The
Regulations also impose, what is referred to as, "a continuing
duty to inform". This applies where the employer has failed to
give notice six months in advance. It places the employer under a
duty to notify until the 14th day before the proposed retirement
date. If the employer fails to comply with this duty - i.e. fails
to give the minimum 14 days notice of retirement - then any
subsequent dismissal for reason of retirement is deemed to be
unfair.
If the employer has given at least six months notice of
retirement, and the employee wishes to work beyond the intended
date of retirement, the employee must make a written request not to
retire more than three months prior to the intended retirement
date. If the employer has given less than six months notice - the
written request can be made at any time prior to the intended date
of retirement. This rule provides an added incentive to employers
to comply with the six months notice period as it removes the
possibility of last minute requests not to retire and the
uncertainty that those would create. The Regulations provide that
the employee's request must state whether the employee wishes his
employment to continue indefinitely, for a stated period or to a
fixed date.
If the employee submits a written request to retire, the
employer is under a duty to consider that request. If possible, a
meeting should be held with the employee to discuss the request
and, as soon as reasonably practicable after the meeting, the
employer must inform the employee whether or not the request is to
be granted. The employee has the right to appeal if the request is
refused in its entirety or if it is granted for a period less than
that sought by the employee. If the employee appeals then, where
possible, a meeting should be held to discuss the appeal. If the
employer fails to comply with the duty to consider either the
employee's request not to retire or the employee's appeal against
refusal, or partial refusal, of such a request, then the subsequent
retirement of the employee will constitute an unfair dismissal.
Although novel, in the sense that no other anti-discrimination
legislation has comparable provisions, it remains to be seen how
effective the new procedures will be. Certainly, if an employer is
determined to get rid of employees when they reach 65, the
procedures are not going to prevent that. So long as the employer
goes through the necessary steps of giving notice, considering any
request not to retire and properly dealing with appeals, the
retired employee has no redress against the employer regardless of
how good a case they can present for not retiring. However, the
Regulations do at least provide a means by which employees can
raise the possibility of working on and, to that extent at least,
they are to be welcomed.