After a long time waiting for a significant decision, like the proverbial London buses, two come along at once. Earlier this month the decisions of the employment tribunal scrutinising the legality of city law firm Freshfields' retirement arrangements, and that of the European Court of Justice (ECJ) in relation to compulsory retirement in Spain, were announced in successive weeks.
As well as being about two claimants who, from a different perspective, might be regarded as being in an enviable position, the two cases had another important feature in common: they were both about justifying direct age discrimination. Unlike other discrimination strands, both direct and indirect age discrimination can be justified, and these cases help us to understand how this can be possible.
In the Freshfields case, although Mr Bloxham was clearly disadvantaged because he fell into the 50 to 55 age group, the tribunal decided that the way he had been treated was justified because it was part of a wider exercise to rebalance pension arrangements which had been the subject of extensive consultation and had been approved by the vast majority of the partnership. Although most retirement provision will not be as generous as that offered by Freshfields, the case is relevant to a wider spectrum of employers because it illustrates that tough decisions can be taken, even if they have more of an impact on some age groups than others, if they go about it in the right way.
The Spanish case was about a provision in a collective agreement, authorised by Spanish law, which allowed employers to retire workers compulsorily when they had reached the state retirement age. The ECJ decided that this measure was justified by the Spanish government's social policy, which had regarded compulsory retirement as a measure to reduce unemployment. It now looks as if the UK government will be called upon to justify the retirement exemption in the Age Equality Regulations when the Heyday challenge reaches the ECJ, probably in 2009. The fact that the ECJ did not scrutinise the Spanish legislation too critically suggests that the UK is likely to pass the test, though it cannot be regarded as a foregone conclusion.
For the ECJ decision click here.