In the recent case of Ayodele v Compass Group plc, the Employment Tribunal decided that the retiral of a 65 year old employee was unfair as it was a ‘done deal’.
Under the Employment Equality (Age) Regulations, employers are required to issue notice between 12 and 6 months before retirement; Mr Ayodele’s employers wrote to him less than 4 months before the proposed retirement date. Late notification alone does not necessarily mean a retirement dismissal is unfair but, in this case, the Claimant was successful in his unfair dismissal claim and was awarded 8 weeks’ pay in respect of his employer’s failure to notify correctly.
The important aspect of this case was the Tribunal’s consideration of how the employer had handled Mr Ayodele’s request to work beyond 65. Both the retirement policy and the contract of employment set out a retirement age of 65 and the policy also stated that any request to work on would be considered. Mr Ayodele submitted such a request to work beyond 65 for 2 years. His employer refused the request but did not supply Mr Ayodele with reasons for the refusal. Mr Ayodele appealed and, again, his request was turned down without reason.
The Tribunal found that, on the facts of the case, retirement was a ‘done deal’ and therefore the process was meaningless. The Tribunal looked at the Regulations and decided that, although no specific mention of good faith was used, it was implied that employers should consider employees’ requests in good faith. The Tribunal found that the process that the employer had implemented was a sham and was not carried out in good faith. Mr Ayodele was awarded a sum equivalent to the pay for the two years’ further employment requested.
There is the possibility that this decision could be over turned on appeal and Tribunal decisions are not binding on other Tribunals. However, it is important that employers be alert to this decision and ensure that the retirement process under the Regulations is followed correctly and that genuine consideration is given to requests for continued working. The consequences of failing to do so are potentially costly given the level of compensation awarded in this case.
The default retirement age (along with the statutory retirement procedure) are set to be abolished on 1 October 2011, with a phase out commencing on 6 April 2011. However this decision is significant because it illustrates the importance of following the correct procedure in relation to retirement dismissals until the current provisions are repealed. It also demonstrates that a failure to do so could be a costly mistake given that the Claimant was awarded two years pay as compensation.