The ECJ has held in Dansk Industri, acting on behalf of Ajos A/S -v- Estate of Karsten Eigil Rasmussen 2016 that a Danish law which excluded employees from their entitlement to a severance allowance on the termination of their employment if they were entitled to receive a pension was incompatible with the general principle of non-discrimination.

Mr Rasmussen, aged 60, was dismissed. He would have been entitled to a severance allowance equal to three months’ salary, however as he had reached 60 at the date of his departure he was entitled to start drawing on his pension. This was a scheme that he had joined before reaching the age of 50, so under Danish law this meant that the employer could refuse to pay the severance allowance (notwithstanding the fact that Mr Rasmussen intended to find another job and did not wish to retire).

The ECJ had already held in an earlier case, Ingeniørforeningen i Danmark, acting on behalf of Ole Andersen v Region Syddanmark 2010, that this particular law was incompatible with the Equal Treatment Directive. The difference in Dansk Industri was that it concerned a private individual and a private employer, and as such the Directive could not be given direct effect.

The ECJ held that the Directive itself gives concrete expression to (but is not the source of) the general principle of non-discrimination. The Danish law in question was contrary not only to the Directive but also to the general principle. As a public institution, national courts are obliged to interpret national law in conformity with the general principle wherever possible and to disapply inconsistent provisions of national law where necessary. It is not for the national courts to weigh up the importance of the general principle of non-discrimination against the principles of legal certainty and legitimate expectations. The fact that a private individual may have an alternative remedy (via a claim for state liability in damages) does not alter this obligation either.

This is the latest in a line of cases in which the ECJ has given horizontal direct effect to a directive by relying on a general principle of EU law.