Employers are within their rights to force employees to retire if they can prove that there is a public interest reason in doing so, according to a landmark legal ruling.
The UK’s Supreme Court unanimously dismissed an appeal today by solicitor, Leslie Seldon, who was told to retire by Clarkson Wright & Jakes just after his 65th birthday.
Seldon, who was a partner at the City law firm, wanted to continue working and was unhappy when his request to do so was turned down.
On taking the case to an employment tribunal, he argued that, because the decision to make him retire was taken before the default retirement age was scrapped in October, it amounted to age discrimination.
In its defence, Clarkson Wright & Jakes had to make the case that its treatment of him was justified as ‘a proportionate means of achieving a legitimate aim’ under the Equality Act.
The tribunal, employment appeal tribunal and Court of Appeal had all agreed that Seldon’s retirement was justified and dismissed his claim, but the Supreme Court’s ruling was more ambiguous.
Struggling for evidence
According to Leon Deakin, employment associate at Thomas Eggar, the Court did make it clear that, if employers wanted to “justify direct age discrimination” by having a set retirement age, they needed to ensure that their reasoning was based on “legitimate social policy aims”.
These included young workers having the opportunity of becoming a partner, facilitating succession planning and limiting the need to force older individuals out by reason of poor performance.
But while this part of the ruling meant that employers now had “welcome confirmation” of what could constitute legitimate aims for forced retirement, the age that it was acceptable to use as a cut-off point still needed to be decided on a case-by-case basis, Deakin said.
“Inevitably, this remains a very difficult question for businesses to answer, not least because it will be difficult to prove why retiring someone at 65 is more or less likely to achieve any stated legitimate aims as opposed to forcing them to go at 64, 66 or 67”, he explained.
As a result, unless employers could come up with strong evidence to support the reason for a particular age being chosen, it was “unlikely to satisfy the proportionate test”.
“Indeed, unless there is some form of solid facts and figures to support a specific cut-off age such as health and safety research, the employer will be left severely exposed.” Deakin said. “In my experience, most employers have struggled to find such evidence, especially in service-related or professional sectors.”
Little resolution
Therefore, it appeared that the “most important and tricky issue” still remained unanswered and, despite today’s ruling, “it will remain just as difficult for the majority of employers to compel someone to retire”, he added.
This meant that, rather than paving the way for employers to be able to justify a given retirement age, the verdict was likely to “prove to be of little advantage in practice”.
The Supreme Court also handed down a second judgment today in another age discrimination case that did little to clarify the situation either, however. The case of Homer v Chief Constable of West Yorkshire Police was concerned with the possible scope of justifying indirect discrimination on the grounds of age.
Homer had claimed that he was indirectly discriminated against after being turned down for promotion because he did not have a law degree. Because he was 62 years old and was due (of his own volition) to retire at 65, he did not have enough time to complete the qualification.
As a result, Homer argued that he was being discriminated against because of his age. His chief constable claimed, on the other hand, that the fact that it was not long until his employment was due to end was not a product solely of his age, but could have resulted from an intention to leave for other reasons.
Referring to the “unreality in differentiating between age and retirement”, the Supreme Court held that Homer had indeed been indirectly discriminated against and referred the case to the employment tribunal in order to reconsider the issue of justification.
According to David Whincup, a London-based employment partner for law firm, Squire Sanders, the net effect of both these cases is that, sadly, the position for employers still remains unclear, however.
