Just before Christmas, the Workplace Relations Commission (the WRC) issued the latest in a string of significant decisions addressing the question of whether enforcing a mandatory retirement age triggers the wrath of a claim for age discrimination.
In this most recent high-profile case, the WRC concluded that RTÉ had discriminated against Ms Anne Roper, a former television producer, in requiring her to retire at its mandatory retirement age of 65. Ms Roper was awarded one year's salary (€100,000) by way of compensation – double the award granted to a former TV broadcaster, Ms Valerie Cox, in a similar age discrimination case involving RTÉ in 2018.
The continued trend of substantial compensation awards, against the backdrop of Ireland's ageing workforce and plans to increase the State pension age to 67 next year (and to 68 in 2028), is a cause of concern for employers attempting to balance their business needs without cutting across Ireland's equality laws.
So what steps should employers be taking to navigate these precarious waters and limit exposure to age discrimination claims on retirement?
Mandatory Retirement - What's the legal position?
Ireland's employment legislation allows employers to fix a compulsory retirement age but only where such retirement age can be objectively justified.
The Workplace Relations Commission (WRC) issued useful guidance in 2017, in the form of the Industrial Relations Act 1990 (Code of Practice on Longer Working) (Code). The Code sets out the "best principles and practices" for employers (and employees) to follow in the lead-up to retirement.
In summary, for an employer to be able to stand over any mandatory retirement age, such an age must be (i) objectively and reasonably justified by reference to a legitimate aim; and (ii) the means of achieving that aim must be appropriate and necessary.
Roper v RTÉ – what happened?
Before her 65th birthday, Ms Roper was invited to attend a retirement planning course. This led to Ms Roper communicating her desire to continue working beyond RTÉ's mandatory retirement age of 65. She subsequently raised a formal grievance with RTÉ when this request was declined. Ultimately, on appeal, RTÉ's decision to require her to retire at 65 was confirmed. Ms Roper took a claim for age discrimination to the WRC.
At the WRC hearing RTÉ submitted that its "justification" for requiring mandatory retirement at 65 was to ensure "inter-generational fairness" to enable younger people within RTÉ to progress and enable RTÉ to "produce programmes that are of interest and relevance to a younger audience". RTÉ pointed to its "long-established policy and custom and practice" to require mandatory retirement in order to "motivate staff and new recruits through the prospect of progression and promotion" in addition to enabling RTÉ to "compete in a fast-changing technological world".
RTÉ also pointed to several different documents to support its assertion that Ms Roper was at all times aware of the requirement to retire at 65. These documents included Ms Roper's contract of employment which referred to her membership of the relevant pension scheme, as well as the pension scheme's explanatory booklet and RTÉ staff manual.
What did the WRC decide?
The adjudication officer concluded that the means of mandatory retirement in this instance to facilitate intergenerational fairness "fell considerably short" and that, with Ms Roper's "co-operation and the creative input of management", a more appropriate means to achieve the justification could have been identified.
The officer found that it was "unnecessary to refuse a request from one person to remain on longer" and had regard to examples of several RTÉ employees whose request to remain working beyond retirement had been granted. The WRC concluded that Ms Roper had been "treated less favourably".
What should employers do now?
- Review – employers should review their current approach to retirement and handling requests from employees to work beyond any compulsory retirement age. It is insufficient to effectively pay lip service to the Code and simply set out one or more "objective justifications", such as "succession planning" or "health and safety". An employer should regularly review and stress-test its purported aims. Employers should be in a position to demonstrate that these aims are legitimate and there are no other more appropriate means of achieving them.
- Policy – employers are should put in place a clear and comprehensive retirement policy that unambiguously sets out both the existence of any mandatory retirement age (which should be mirrored in staff contracts of employment) and the rationale (i.e. objective justification) for same. This policy should be drafted to closely align with the guidance set out in the Code and be well known and understood by all staff. Just like an employer's review exercise, any retirement policy should be regularly re-evaluated and updated to ensure that the identified "justification" continues to be appropriate and necessary.
- Implementation – finally employers should be consistent in their approach to enforcing any mandatory retirement age – in particular when considering requests to work beyond such an age on a fixed-term basis or otherwise.
Conclusion – Tread Carefully
Almost half of all equality complaints made to the WRC in 2018 were focused on the specific ground of "age" – a dramatic 343% increase on such claims in 2017. This statistic, coupled with the continuing trend of high-profile cases and significant compensation awards, will no doubt be the focus of many employers' New Year's resolutions – to tread very carefully when seeking to enforce a mandatory retirement age.