In William J Loxley v BAE Systems Land Systems the Employment Appeal Tribunal (EAT ) found the Employment’s Tribunal analysis of an age discrimination claim to be defective. The EAT upheld the appeal against the Tribunal’s decision and remitted the case to be considered by a fresh Tribunal.

In this case the claimant had been excluded from a voluntary redundancy scheme because he had reached the age of 60. When the scheme was introduced the compulsory retirement and normal pension age was 60 and the purpose of the exclusion was to avoid employees who were over 60 and entitled to payment of a pension benefit from also benefitting from a contractual redundancy payment. The retirement and normal pension age were later increased to 65 but the redundancy scheme was not amended to reflect this.

In this case it was admitted that the redundancy scheme was directly discriminatory on the grounds of age pursuant to the Employment Equality (Age) Regulations 2006. The issue before the EAT was whether the age discrimination was justified and whether the exclusion of the claimant from the scheme achieves a legitimate objective and is proportional to any disadvantage suffered.

The EAT commented that in assessing whether it was justifiable to exclude an employee from a redundancy scheme an employee’s entitlement to an immediate pension benefit will always be a highly relevant factor to consider.

The EAT further commented that the fact that an agreement had been reached with the trade unions is potentially a relevant consideration when determining whether treatment is proportionate. However, a trade union’s approval does not render an otherwise unlawful scheme lawful.

On the facts the EAT found that the Tribunal had not properly analysed all the relevant financial data and remitted the case back to a fresh Tribunal.

Comment

This case demonstrates the difficulty for an employer in showing an objective justification for age discrimination.