In Bloxham v Freshfields, the Employment Tribunal upheld an objective justification defence raised by an employer in relation to a claim of age discrimination. The claim arose because Freshfields sought to reform its pension arrangements to reduce the perceived unfairness, inherent in the existing arrangements, to younger partners.
Freshfields operate an unusual and complex pension arrangement (not an occupational pension scheme). The effect of the reforms was that the claimant, a partner, retired at age 54 with a 20% reduction in pension (when compared to a partner who retired aged 55 with a full pension). The Tribunal held that the potential discrimination could be objectively justified in that it was a "proportionate means of achieving a legitimate aim"; the legitimate aim being "the attempt to provide a more financially sustainable pension scheme which reduced the intergenerational unfairness on younger partners."
The test for objective justification was "comfortably passed". The Tribunal cited certain factors which had influenced its decision. In particular, it acknowledged that there was recognition that younger age groups were disadvantaged by the existing pension arrangements and that the reforms were aimed at addressing that issue. During this process, it was acceptable to maintain the status quo for those "most proximately affected" (although this does not absolve the employer from considering other steps). The Tribunal also noted that no less discriminatory alternative had been put forward during the lengthy and thorough consultation period (nor had one been suggested during the hearing).
Whilst the Freshfields arrangements are unusual, the case does provide helpful guidance on the concept of objective justification. The Tribunal was satisfied that reducing intergenerational unfairness for younger employees was a legitimate aim under the legislation; and also that the potential age discrimination was a proportionate means of achieving that aim.