Requiring a partner to retire at a certain age is direct age discrimination which can be justified if it achieves a legitimate aim by proportionate means.
One of the first cases considering compulsory retirement ages is Seldon v Clarkson Wright & Jakes where a partner was required to retire from a law firm having reached the age of 65. The employment tribunal found that a retirement age of 65 for partners in a small partnership was justified as a proportionate means of achieving 3 legitimate aims:
- retaining associates by being able to offer partnership prospects;
- facilitating succession planning; and
- contributing to a congenial and supportive culture by limiting the need to expel partners through performance management.
The third aim, on appeal, was found to be unsupported by evidence as it was based on a stereotypical ageist assumption that a partner's performance tails off at the age of 65.
Finding evidence to support a specific retirement age is difficult. Whilst the fact that partners, with equal bargaining power and with the best knowledge of their own business, have agreed a certain retirement age carries some weight, specific analysis of the firm's past experience (or that of similarly placed firms) is required. This can be problematic as, on a practical level, most partners leave voluntarily well before the retirement age.
This case is important for partnerships and LLPs as the exemption which allows compulsory retirement of employees at 65 is not applicable. Whether the employee exemption for retirement at 65 can be justified on a national level is being considered in the Heyday case (due to be heard in the High Court on 16 - 17 July 2009).
(Seldon v. Clarkson Wright & Jakes  UKEAT 0063/08 and The Incorporated Trustees of the National Council on Ageing (Age Concern England) v. Secretary of State for Business, Enterprise and Regulatory Reform (also known as the Heyday case) Case C-388/07).