The ECJ has found that a German employer's policy imposing compulsory retirement for civil servants when they reach 65 is lawful as its main aim is to ensure a balanced workforce of all ages.  They added that if its main purpose had been to save costs this would not have been a legitimate justification, although local authorities do have the right to consider costs when introducing policies.

In this case, the two claimants brought a claim for age discrimination when their requests to work until 68 were refused.  The ECJ held that:

  • The policy aimed to create a workforce which was balanced in age, which facilitated staff planning and encouraged the recruitment and performance of younger workers.
  • The policy did not go beyond what was legitimate and necessary to achieve the employer's aim as it allowed the retirement age to be extended to 68 and beyond this, employees could continue in a role with no age limit.  In addition the claimants could retire on 72% of their salary.
  • The civil service maintained the general principle prohibiting age discrimination.

Key point: It is important for employers to ensure that any retirement policy has clear, legitimate objectives not based entirely on cost efficiency.

Fuchs and anor v Land Hessen