Key learnings
The Equality (Miscellaneous Provisions) Act 2015 amended the rules on mandatory retirement and age discrimination, making mandatory retirement ages objectively justifiable by Employers. This has been supplemented by the Industrial Relations Act 1990 (Code of Practice on Longer Working) (Declaration) Order 2017. This Code of Practice aims to guide Employers, Employees and their representatives on the best practice in the run-up to retirement, including responding to requests to work beyond the retirement age in the employment concerned.
While there is no prohibition on Employers setting a certain age at which Employees must retire, the enactment of the Equality (Miscellaneous Provisions) Act, 2015, means that while the right still exists, it is now only permitted if it is, (a) is objectively and reasonably justified by a legitimate aim and (b) the means of achieving that aim are appropriate and necessary. In this case the Respondent Employer had in place a contractual clause relating to retirement at 65 years of age and a collective agreement regarding same. However, even if the contract does contain an enabling clause (or an implied clause through a collective agreement) this does not mean that the Employer has a unilateral right to enforce retirement against the Employee’s will and should after an application to remain working beyond the retirement age is made, consider each request on its own merits and abide by the procedures laid out in the Code of Practice.
Background
The Complainant worked for the Respondent, a meat processing company. On reaching the age of 65 he was required to resign. He made an application to continue working but this was refused.
Summary of Complainant’s Case
The Complainant alleged that he was discriminatorily dismissed on the grounds of age due to enforced retirement on 18th August 2019. In June 2019 the Complainant advised his manager that he was seeking to work beyond his 65th birthday. He was aware of other Employees who had been afforded this facility. He received a letter from HR on 10th June 2019 referring him to the Works Agreement in relation to retirement age. Following correspondence between the Respondent and the Complainant’s union official, the Company confirmed their position by letter dated 15th August 2019.
The Complainant had a good record with the Respondent and was fit and healthy and able to perform all his duties. There was no consultation or negotiation. The company did not adhere to the Code of Practice on longer working.
The Complainant was treated less favourably than his fellow comparators who were allowed to work past 65. In one case the Respondent gave the reason that the Company could not recruit a suitable replacement, but the Complainant understands that the Employee in question decided he did not want to retire and was allowed to continue. Another Employee was requested by management in 2018 to continue but chose not to. In another plant, at least one Employee was allowed to work past 65 years of age.
The Complainant was one of a number of a group which had transferred to the Respondent Company under a Transfer of Undertaking retaining the working conditions of his former Employer per legal requirements. The retained terms and conditions were superior conditions, and the Complainant believes that this was the reason why he was not allowed to continue.
The Code states that ‘it is good practice of an Employer to notify an Employee of the intention to retire him/her on the contractual retirement date within 6-12 months of that date’. There was no such notification in this case. The Request to Work Longer Procedure was not followed. The Respondent did not provide the Complainant with the grounds for the decision or the right to appeal.
Summary of Respondent’s Case
The Respondent has a long-established normal retirement age across the Organisation of 65 years. The Complainant alleged that the act of the Respondent requiring him to retire from his employment on his 65th birthday amounted to discrimination within the meaning of the Employment Equality Acts 1998 to 2015. The Respondent rejected this claim entirely on the grounds that the long-established and contractual company retirement age, 65, was objectively and reasonably justified by a legitimate aim, including a legitimate employment policy and succession planning and that the means of achieving that aim are appropriate and necessary.
The Complainant signed a contract of employment dated 11th December, countersigned by the company. He agreed to be bound by Labour Court Recommendation 12544 which confirmed that SIPTU member Employees employed at the site agreed to the contents of the various local agreements that were in place at the time in the plant. He signed a follow-on contract on the 11th of June 2001 agreeing to be bound by the Company Works agreement with SIPTU, the recognised union. The Company/ Union agreement sets out the normal retirement age as 65 years. When the Complainant was transferred to the Respondent Company the terms and conditions he carried were more favourable on basic pay rates, service pay, holiday entitlement, sick pay, etc. The Complainant was enrolled in the Company pension scheme, membership of which is voluntary to all qualifying Employees. The terms and conditions of this pension scheme, including the retirement age of 65 years, were negotiated, and collectively agreed with the Trade Union SIPTU. In response to the Complainants request to work beyond the age of 65 years, the company responded by letter 10th June 2019 copying him with excerpts from the Company/ SIPTU Works Agreements stating that Employees must retire on reaching the age of 65 years.
The Complainant suggests that other Employees could work on past 65 years and that he should have too for the same reasons. This is denied. One Employee did work past 65 years for a period of 10 months as he had a very specialist skill set as a lab technician in preparing and mixing the formulation of salts, brine, and other compounds for bacon products. He trained up an individual in these skills which are very rare and hard to find in the market and exited the business as soon as that training period was completed in March 2020.
Another Employee left on February 13th 2020, 12 months beyond his retirement again because he had very specialist skills in thermal processing of canned meat products and the maintenance of the machinery to support the process. At that time, he could not be replaced in Ireland – there was no one to do so and the Respondent Company are one of few remaining thermal processors (canners) of meat products. The company had to engage with a Danish Company to send a technician to Ireland to train a replacement.
The second issue of concern is whether the establishment of a ‘normal retirement age’ of 65 years is an act of discrimination under the Employment Equality Acts 1998 to 2015.
The Respondent submits that they have a well-established practice of compulsorily retiring its Employees when they reach the age of 65 and this is clearly identified in the Respondent’s contracts of employment, Company/ Union Work agreements, and pension scheme. ln this respect the Respondent submits that the retirement of Employees at age 65, including the Complainant was objectively necessary and reasonably required or justified to; ensure consistency among all Employees in relation to retirement; to create certainty in succession planning; to ensue cohesion in the workforce; to ensure a uniform retirement age; to ensure that there is an age balance in the workforce and; to free up jobs so that younger workers can enter to the workforce and younger workers have an opportunity for advancement/promotion.
The above are legitimate and justified aims and objectives and the means adopted by the Respondent to achieve these aims and objectives are both appropriate and necessary.
It is the Respondent’s position that the company compulsory retirement age of 65 years is permitted by both Section 34(4) and 37(2) of the Employment Equality Acts and the alleged act of discrimination with regards to age serves a legitimate aim or purpose as laid out, and the means taken to achieve that purpose are appropriate and go no further than is necessary, i.e., they are proportionate.
The burden of proof rests with the Complainant to show that he was discriminated against on the grounds of age. Should the Complainant shift this burden, it is the position of the Respondent that the Complainant was retired in line with the normal companywide retirement age which is lawful within the provisions of Employment Equality Acts as described above.
As the Complainant has not established a valid prima facie case of discrimination on the grounds of age, the Respondent requests that the Adjudicator reject this Complainant’s allegation under the Employment Equality Acts 1998 to 2015. The company relies upon the protection afforded to it under section 34(4) of the Employment Equality Act 1998 to fix a mandatory retirement age that is objectively justified which has been detailed above in this submission. The means of achieving these aims are appropriate and necessary and the Respondent asserts it has met these requirements under the Equality Acts. The Respondent submits for the reasons set out above that the Complainant was not discriminated against under the Equality Acts.
Findings and Conclusions
The Employment Equality Acts 1998 to 2015 prohibit discrimination on age grounds. Section 34(4) of the Act requires an Employer to objectively justify any retirement age policy. In light of this, an Employer is generally required to establish the following:
(a) That there is a contractual retirement age that forms part of the terms and conditions of employment.
(b) That the policy it is objectively and reasonably justified by a legitimate aim; and
(c) The means of achieving that aim are appropriate and necessary.
It is well established that the imposition of a mandatory retirement age is discriminatory per se, and to be lawful such a mandatory retirement age must serve a legitimate aim or purpose and the means deployed to achieve that purpose must be appropriate and should go no further than is necessary. The burden of proof in justifying an otherwise discriminatory provision rests with the respondent.
The next key consideration is whether the Employer can objectively and reasonably justify the decision to insist on retirement by reference to a legitimate aim.
Following recommendations of the Interdepartmental Group on Fuller Working Lives, the WRC published a Code of Practice in 2017 on encouraging longer working which sets out best practice and includes the following advice to Employers when considering requests to work on past the normal retirement age:
What are the objective criteria applicable to the request? This should form the basis of any assessment of a request to work beyond retirement age to ensure an equal and consistent approach to addressing this and other future requests.
The Respondent has detailed the objective grounds for retirement at 65. However, there is no evidence that these reasons were put to the Complainant at any stage. Neither the examples of legitimate aims determined by the courts, nor those detailed by the Respondent, can be considered as generic justification for refusing all requests to work past the normal retirement age. Otherwise, the intention of the social policy in relation to longer working would be rendered meaningless. In my view there is an obligation on the Employer to present the Employee making the request to work longer with the specific objective grounds as to why his or her request is being refused. The Employee should have the opportunity to test these arguments before a final decision is made. There is no evidence in this case that the objective grounds, now being put forward by the Respondent, were presented to the Complainant in advance of the decision to refuse his request to work longer. The Respondent, in the communications, relied exclusively on the enabling clause in the contract and in the collective agreement.
Decision
The Complainant was discriminated against, and the Adjudicator ordered the Respondent to pay him the sum of €30,000 in compensation.