Employers are likely to welcome the Advocate General's (AG) opinion delivered on 23 September 2008 that compulsory retirement provisions, such as those contained in the Age Regulations, can, in principle, be justified under the Framework Directive (2000/78/EC). A deluge of age discrimination claims will be avoided if the Government can now go on to demonstrate that the "default" retirement age of 65 in the UK is lawful as a necessary and proportionate means of achieving a legitimate labour market aim.
The ECJ, which is expected to give judgment later this year or early 2009, is not bound by the AG opinion. But, in light of the ECJ's findings in Palacios de la Villa (C-411/05) (covered in our October 2007 e-bulletin) it seems likely that the ECJ will follow the AG, at least in its findings that national provisions on retirement ages fall within the scope of the Framework Directive. If the ECJ considers the UK retirement provisions capable, in principle, of justification, the High Court would then review all relevant evidence to determine whether the provisions are in fact reasonable and implement a legitimate labour market or employment policy aim.
The AG emphasised that Member States have a broad discretion to introduce national rules relating to retirement age. The justification test for direct and indirect discrimination is broadly the same and there is, in the AG's opinion, no requirement on Member States to define the specific kinds of treatment which can be justified by means of a list of measures. Further, the fact that the Directive refers to "reasonably and objectively" justified whilst the UK Regulations simply refer to "objective" justification was not significant. The principle of objective justification had been correctly transposed by the UK. (The Incorporated Trustees of the National Council of Ageing (Age Concern England) v Secretary of State for Business, Enterprise and Regulatory Reform (known as the Heyday challenge) (AG opinion - C-388/07)) (See details of Heyday's judicial review application and the questions referred to the ECJ in our August 2007 e-bulletin).
More than 250 claims which are currently stayed will remain so until the High Court's judgment is given following a substantive hearing of the government's justification defence.
Given that the Government intends to review the default retirement age in 2011 and may abolish it, if it is no longer deemed necessary, it will be interesting to see how robust a defence the Government mounts at the High Court (see Hansardhttp://www.publications.parliament.uk/pa/ld200506/ldhansrd/ vo060626/text/60626-03.htm).