On appeal from the Equality Tribunal, the Labour Court held that differences in the level of redundancy payments paid to the complainants, as compared with their younger comparators, fell within the exception to age discrimination permitted by section 34(3)(d) of the Employment Equality Acts 1998 – 2011 (the EEAs*).
The Equality Tribunal had held that caps on termination payments constituted indirect discrimination on the grounds of age and would only be lawful if objectively justified.
The Labour Court found that the Oireachtas expressly provided in section 34(4) of the EEAs for differences in treatment on grounds of age. The Court noted that the underlying rationale for the provision was that workers close to retirement are in a substantially different position than those who have longer periods in which they could have expected to remain in the active labour force and that as a matter of social and labour market policy this difference can be justified in construing redundancy packages.
This decision represents a significant departure from the recent body of case law requiring objective justification for age discrimination. It will be interesting to see if this argument is extended to compulsory retirement case law. This would be an interesting development given the body of case law which has emerged from the Equality Tribunal requiring objective justification in line with the grounding European Directive.