Two recent Supreme Court decisions have put age discrimination squarely back in the public eye. Both cases focussed on the issue of objective justification. Age discrimination is the only head of discrimination in which both indirect and direct discrimination can be objectively justified. The case of Seldon v Clarkson Wright & Jakes considers the test for objective justification in relation to direct discrimination, whilst in Homer v Chief Constable of West Yorkshire Police the Supreme Court looked at justification in respect of indirect discrimination. Both judgments set out useful guidance for employers.
Seldon v Clarkson Wright & Jakes
In the important case of Seldon v Clarkson Wright & Jakes, the Supreme Court upheld the Court of Appeal's decision that a compulsory retirement age of 65 in a partnership deed can be justified under the age discrimination legislation.
When this case was first launched, the statutory default retirement age ("DRA") remained in place for employees so the case's relevance for employers (rather than partnerships) was limited. Now that the DRA has been abolished, the principles set out in Seldon are vitally important to any employers wishing to impose a compulsory retirement age.
Mr Seldon was a partner in a law firm and claimed that the compulsory retirement age of 65 contained in the firm's partnership deed was discriminatory on grounds of age. The Employment Tribunal, the EAT, the Court of Appeal and now the Supreme Court have all agreed that whilst a mandatory retirement age is directly age discriminatory, it is capable of being objectively justified. The Supreme Court carried out a thorough review of the age discrimination decisions made to date by the European Court of Justice and held that there are two different types of legitimate objective that are permissible in cases of direct age discrimination – inter-generational fairness (i.e. recruitment, retention and succession planning) and dignity, which includes slightly more controversial aims such as avoiding the need to go through capability procedures with older employees and the avoidance of costly and divisive disputes about capacity or underperformance.
The aims relied upon by Mr Seldon's firm were: ensuring that associates have the opportunity of progressing to partnership after a reasonable period to avoid associates leaving the firm, facilitating planning for the partnership and limiting the need to expel partners by way of performance management, thus contributing to a congenial and supportive culture. These aims were held by the Supreme Court to fall within the permissible categories and it was accepted that they were potentially legitimate.
This case has been billed by many as a green light for the re-introduction of mandatory retirement ages – essentially taking us back to where we were before the abolition of the statutory DRA. The position, however, is not quite as simple as that. Whilst this judgment is potentially useful for employers and partnerships alike, this is not the end of the line for Mr Seldon – the case now has to be remitted to the employment tribunal to decide whether the firm's actions were justified in these particular circumstances. The Supreme Court made it clear that not all applications of potentially legitimate aims will be permissible. The means chosen to implement a particular objective must be appropriate and necessary and, in order to find in favour of an employer, a Tribunal must be satisfied that the measures applied actually meet the particular aims and that other, less discriminatory, measures were not possible.
Homer v Chief Constable of West Yorkshire Police
In Homer v Chief Constable of West Yorkshire Police, the Supreme Court overturned the Court of Appeal's decision and held that Mr Homer, whose impending retirement meant that he did not have time to obtain the law degree which was required for him to benefit from a promotion and salary increase, had been put at a disadvantage on grounds of age.
Mr Homer had been a police inspector for a number of years and then took a job as a police legal adviser. At the time he took the job he was not required to have a law degree. Following a restructuring, however, the police force introduced new requirements which meant that Mr Homer could not move up to the top level within the legal advisory service as he did not have a law degree. Whilst he could have obtained a law degree, he would not have been able to complete the degree until after he reached the police compulsory retirement age of 65. The police force was not prepared to make an exception for Mr Homer.
The Supreme Court's view was that, although it was his imminent retirement rather than his age which prevented him from achieving the promotion, retirement is intrinsically linked with age and therefore the treatment amounted to indirect age discrimination. They did not accept that Mr Homer should be compared with an employee who was leaving the service for reasons other than compulsory retirement – his circumstances were materially different to those of an employee who voluntarily takes early retirement, for example. As in Seldon, the Supreme Court has now remitted the case to the Tribunal to decide whether the discriminatory treatment is objectively justified.
In its judgment, the Supreme Court gave useful guidance about how Tribunals should consider objective justification in indirect discrimination cases. In particular, the Court stated that, although the wording in the legislation in relation to objective justification is the same for both direct and indirect age discrimination, the range of aims which will be considered legitimate in cases of indirect age discrimination cases is in practice broader than in direct discrimination cases. In indirect discrimination cases, there is no need for an employer to show any public policy element in order for an aim to be legitimate – it is sufficient for them to show that there is a genuine need on the part of the employer.
While the Supreme Court has provided some useful guidance for employers and Tribunals alike, both Mr Homer and Mr Seldon have some way to go before their cases reach a conclusion. If nothing else, it is certainly clear that this is a complex area and that each case will be looked at on its own particular facts.