By Yvonne Frederiksen, Firm: Norrbom Vinding 

The Danish Supreme Court has established that an employer’s dismissal of a disabled employee working in a publicly funded reduced-hours job when he reached mandatory retirement age and public funding for the job lapsed did not conflict with the Anti-Discrimination Act.

When an employee with a reduced-hours job reaches the statutory retirement age, public funding relating to the job ends. However, according to the Danish Anti-Discrimination Act, employers must not discriminate against employees on grounds of age or disability.

In this case, the question before the Supreme Court was whether the dismissal of an employee with a reduced-hours job as a result of the lapse of public funding for the job constituted discrimination in breach of the Anti-Discrimination Act, or whether the dismissal was in conflict with the Act on Part-Time Work and the Salaried Employees Act.

The case concerned an employee with a reduced-hours job. He worked 20 hours a week in a white-collar position at a company. The local authorities paid two-thirds of the costs for the reduced-hours working scheme through a wage subsidy to the company. The employer dismissed the employee when he reached the statutory retirement age, referencing the fact that the agreement on reduced-hours working with the local authorities had lapsed. The employee, however, wanted to continue working for the employer in a position where the pay and employment terms corresponded to his working capacity (i.e. a part-time position with reduced pay).

The employee’s trade union believed that the dismissal contravened the Anti-Discrimination Act, the Act on Part-Time Work and the Salaried Employees Act and therefore issued proceedings, which ended up in the Supreme Court.

No breach of the Anti-Discrimination Act

Firstly, the Supreme Court established in its judgment that the reduced-hours working scheme consists of two elements: the employment relationship and a public subsidy. It must be regarded as a job-creating effort under the provision in the Anti-Discrimination Act specifying that measures can be taken with a view to improving the employment possibilities for people of a certain age or with a certain disability. The termination of such a positive special measure as a consequence of the employee in question reaching the statutory retirement age cannot, in the opinion of the Supreme Court, be considered to be unlawful discrimination on grounds of age or disability.

Secondly, the Supreme Court stated that it had to be regarded as a clear condition for the employment that the employer received a subsidy relating to the reduced-hours job from the local authorities. The basis of the employment thus lapsed when the wage subsidy ended.

Against this background, the Supreme Court found that the dismissal of the employee with a reduced-hours job did not breach the Anti-Discrimination Act.

Since the basis of the employment had lapsed as a consequence of the cessation of the reduced-hours working scheme, the dismissal was also not in conflict with the Act on Part-Time Work and/or the Salaried Employees Act.

The Supreme Court upheld the judgment by the Maritime and Commercial Court.

Norrbom Vinding notes

The Supreme Court establishes that the reduced-hours working scheme consists of two elements (the employment relationship and a public subsidy) and that ending such a positive special measure as a result of the employee reaching the mandatory retirement age does not constitute unlawful discrimination on grounds of age or disability.

In this specific case, the Supreme Court rules that the dismissal of the employee who had reached mandatory retirement age at which point the public wage subsidy relating to the reduced-hours job lapsed was therefore not in breach of the Anti-Discrimination Act, regardless of the fact that this condition was not expressly stated contractually.

The dismissal of the employee on those grounds was not in conflict with the Act on Part-Time Work nor with section 2b of the Salaried Employees Act.