There has been significant focus in recent years in relation to age discrimination in respect of the issue of mandatory retirement ages. The Employment Equality Acts (the “Acts”) prohibits discrimination by an employer on the grounds of age. In circumstances where an employee feels they have been forced to retire upon reaching the company’s mandatory retirement age, it may be open to them to take a claim for discriminatory dismissal on the grounds of age.
Under section 6(1) of the Acts, discrimination occurs where a person is treated less favorably than another person is, has been or would be treated in a comparable situation on any of the nine discriminatory grounds specified under the Acts which exists, existed but no longer exists, may exist in the future or is imputed to the person connected.
For a claimant to succeed in a claim under the Acts, the burden of proof is on the employee to establish facts from which a presumption of discrimination can be made. Once this has been established, the burden of proof shifts to the employer to rebut the presumption on the balance of probability.
In the context of retirement, section 34(4) of the Acts makes it clear that it is not discriminatory on the ground on age, for an employer to fix different ages for the retirement of employees provided that it can be objectively justified by a legitimate aim and the means of achieving that aim are appropriate and necessary. This means that an employer can still include a mandatory retirement age in the contract of employment, but there must be a legitimate reason for it and it must not be disproportionate to the aim.
Examples of objective justification include:
- To create opportunities in the labour market.
- To enable a balanced age structure in the workforce.
- To encourage motivation and dynamism through the prospects of career enhancement and promotion.
- To ensure the health and safety of employees.
The Industrial Relations Act 1990 (Code of Practice on Longer Working) (Declaration) Order 2017 (the “Code”) provides guidance for employers in respect of the retirement process and sets out best practice in regards to managing a request received from an employee to work beyond their contracted retirement age. Although the Code is not legally binding, if challenged, an employer will have to justify not complying with it. An employer will be in a stronger position to defend a claim if it can show that the Code has been implemented.
Application of the Code was examined in Kathleen Dempsey v The West of Ireland Alzheimer Foundation ADJ-00014857. In that case, Ms. Dempsey was awarded €14,000 when it was found that the she had been discriminated on the grounds of age as she was forced to retire by reason of reaching the company’s retirement age of 65. Three of Ms. Dempsey’s colleagues were permitted to stay on beyond the retirement age. In early May 2018, Ms. Dempsey, who had worked as a care assistant for her employer for 15 years, was asked if she would be retiring later that month to which she replied she would not. The employer’s HR consultant then contacted Ms. Dempsey and she told him she did not wish to retire. Ms. Dempsey subsequently received a letter on 11 May 2018 advising her that her employment would cease on 23 May 2018 owing to retirement. Ms. Dempsey argued that there had been no complaints regarding her ability to carry out her duties, there was no risk assessment conducted in respect of any concerns regarding her ability and her continued employment was not an obstruction to the progression of younger workers.
The employer argued that Ms. Dempsey’s role is physically demanding and that she recently had significant certified periods of absence amounting to 27 weeks between 2015 and 2018. It noted that while it did not doubt the genuineness of the absences, it was an indicator of a trend that those in labour-intensive work will suffer with increasing illnesses as they get older. The employer stated that Ms. Dempsey’s employment had not been terminated because of her health but because of the company’s mandatory retirement age. It further argued that Ms. Dempsey never made a formal request to work longer, but confirmed that no other employees who stayed on after the age of 65 were required to make a formal request to stay on. It was also established that there was no formal application for employees to remain on after the age of 65.
The Adjudicator found that during the initial conversation with her employer about her retirement and the telephone call with the HR consultant on 11 May 2018, Ms. Dempsey had made it clear that she did not wish to retire. It was noted that the letter sent to Ms. Dempsey stating that her last shift would be on 20 May 2018 was sent only two weeks before her retirement. The Adjudicator emphasised that the Code states it is good practice for an employer to notify the employee of the intention to retire him or her on the contractual retirement date within six to 12 months of that date. Accordingly, it was found that the employer should have initiated conversations regarding Ms. Dempsey’s forthcoming retirement sooner.
In relation to objective justification, it was found that the employer failed to present any legitimate health and safety grounds that would have prevented Ms. Dempsey working past the age of 65. The employer was unable to provide a reason as to why other employees were allowed to remain in employment after the age of 65, but Ms. Dempsey was not permitted to do so.
The prohibition against age discrimination means that if an employee believes they have been discriminated against on the grounds of age, they can pursue a claim under the Acts.
It is open to an employer to have a mandatory retirement age, however, it must be capable of being objectively justified by a legitimate aim and the means of achieving that aim are appropriate and necessary.
The Code provides guidance for employers and sets out best practice for managing the communication between employers and employees in the run-up to retirement. Although the Code is not legally binding, if challenged, an employer will be required to justify why it derogated from the Code.