Age Discrimination Briefing for Managers

Transcription

1 Age Discrimination Briefing for Managers 1. Employers' potential liability for age discrimination Employers are generally liable in law for any discriminatory actions perpetrated by their staff in the course of their employment. This means that if a manager or one of his or her team does or says anything that could be construed as discriminatory because of age, the employer will be potentially liable to pay compensation to the victim if a successful complaint is subsequently made to an employment tribunal. The individual who carries out the act will also be personally liable and could be required to pay compensation to the victim. An employee or job applicant who believes that he or she has experienced discriminatory treatment generally has three calendar months from the date of the discriminatory treatment to lodge a claim with a tribunal. There is no limit on the amount of compensation that can be awarded by tribunals in discrimination claims. Did you know that In 2009 the total amount of compensation awarded by tribunals in discrimination cases was 8,000,000? Source: EOR Compensation Awards 2009: Part 1 2. The law Under discrimination law it is unlawful to discriminate against job applicants or employees because of age. Other categories of workers such as agency temps and contractors are also protected. It is, therefore, safest for line managers to assume that everyone in the workplace is protected against age discrimination. People of all ages are protected. For example, all of the following would potentially be protected by the age discrimination legislation: a 20-year-old who is not given a job because she is considered too young; a 55-year-old who is not promoted because he is considered too old; and a middle-aged woman who is not given training on the basis that she has been out of university for 10 years and is considered too old to be able to adapt and change.

2 There are four types of unlawful age discrimination: direct discrimination; indirect discrimination; harassment; and victimisation. Direct discrimination Direct age discrimination occurs where an individual, or group of individuals, is treated less favourably because of age. Direct age discrimination can, however, be justified. The legislation makes no reference to the age of any particular person. Therefore, for direct age discrimination to arise, it is not necessary for the person complaining of less favourable treatment to actually be of any particular age group. This gives rise to two possibilities: Discrimination because of an association with someone of a particular age group. This means that less favourable treatment based on the age of a relation or association of the employee's is unlawful. For example, less favourable treatment because an employee has a young child could constitute age discrimination against the employee, even though the employee s age is not the reason for the employer s treatment. Discrimination because of a person's perceived age. This means that if someone looks older or younger than he or she is, and is discriminated against on this basis, this could be unlawful. For example, a 30-year-old who is not given a promotion to a managerial position on the basis that he looks about 20 and it is therefore thought that he does not have the required gravitas for the role, and a 40-year-old who is not given a job as a sales representative on the basis that he appears to be in his late fifties, could both be discriminated against because of age. The following are examples of direct age discrimination: A manager wishes to hire a new secretary but ignores all applications from older individuals, regardless of their skills or capability to do the job, because he wants a young secretary. The manager would be treating older applicants less favourably than younger applicants solely because of their age.

3 A manager has a team of 10 subordinates. She wishes to appoint a supervisor for the team from this group of 10, but does not consider the younger members of team, regardless of their skills or capability to do the job, because she believes that an older person is necessary for the leadership role. The manager would be treating the younger members of the team less favourably than the older ones solely because of their age. A manager wants to create a specialised role in her team, which will necessitate further training for the individual. She does not consider any of the younger members of her team because she assumes that they will not be sufficiently dedicated to take it on. Neither does she consider any of the older members of her team, on the assumption that they will not be capable of adapting to change. The manager would be treating both groups less favourably than the middle-aged members of the team solely because of their age. A manager does not offer an individual a promotion because she has an elderly husband. The manager may be treating the employee less favourably because of age, even though the employee s age is not the reason for the employer s treatment of her. Indirect discrimination Indirect age discrimination occurs where the employer applies to all employees or job applicants a provision, criterion or practice that puts an individual at a disadvantage, where it also puts people who are in the same age group as the individual at a disadvantage compared with others. Indirect age discrimination can, however, be justified. The following are examples of behaviour that might amount to indirect age discrimination: An employer has a requirement for employees to have 10 years' experience before being eligible for promotion to managerial level. Although this policy is applied equally to employees of all ages, it disadvantages younger employees because they are less likely to have the required 10 years' experience than older employees. An employer refuses to consider anyone who has more than 20 years' experience for employment. Although this policy is applied equally to potential applicants of all ages, it disadvantages older people because they are more likely to have over 20 years' experience than younger people.

4 Harassment Harassment occurs where an employee is subjected to unwanted conduct related to age, and that conduct has the purpose or effect of: violating his or her dignity; or creating an intimidating, hostile, degrading, humiliating or offensive environment for him or her. It is possible for a person to complain of age-related harassment even though he or she is not of a particular age. This permits an employee to complain of harassment where the offensive conduct is not directed at him or her, but he or she witnesses a colleague being subjected to age-related harassment and is offended by it. It also permits an employee to complain of harassment: based on his or her association with someone of a particular age, for example if an employee is teased about his relationship with a woman because she is much younger than him; based on perceived age, for example where an employee is ignored by her colleagues because of their mistaken belief that she is over 50 years old; or where age is used simply as an excuse for the unwanted conduct, for example where an employee is mocked for being in her 20s, even though the harasser and the victim know that that she is not. The motive of the "harasser" is irrelevant. The phrase "purpose or effect" makes it clear that behaviour can amount to harassment in the absence of any deliberate intention to discriminate. The key issue will be the effect on the person on the receiving end of the behaviour. It will not matter whether others find particular behaviour funny or otherwise acceptable if the same behaviour genuinely causes offence or distress to the person who is complaining about it. Managers should, therefore, refrain from assuming that an employee who objects to certain behaviour is overreacting or that the complaint is trivial. In deciding whether conduct has the effect of violating the other person s dignity, or creating an intimidating, hostile, degrading, humiliating or offensive environment, an employment tribunal will take into account the employee s perception, the other circumstances of the case, and whether or not it is reasonable for the conduct to have that effect. This ensures a degree of balance between the victim's subjective perception of the treatment and an objective, reasonable viewpoint, and means that an oversensitive person who takes offence unreasonably at a wholly innocent remark will not have a legitimate complaint of harassment.

5 Harassment may involve teasing, name calling or jokes. It may relate to an individual's age, or perceived age, or the age of his or her friends or colleagues, or may simply be part of a general ageist culture. The following are examples of potential harassment: An employee in the office turns 50 and, despite knowing that she is sensitive about this, the employee's colleagues buy a card with a joke stereotyping 50 year olds. Team members commonly make jokes at the expense of the youngest member of the team. He is constantly told that he is "wet behind the ears" and finds children's toys on his desk, placed there by his colleagues. In both cases, this might be humiliating for the employee and could potentially amount to harassment. To help prevent harassment in the workplace, managers should make their team aware of the employer's equal opportunities policy, and the types of behaviour that are unacceptable. If a manager becomes aware of any behaviour that might amount to harassment, he or she should take action to stop it, and should consider whether equal opportunities training for the team is necessary. If the instance of harassment is serious enough, the manager should also consider whether the company disciplinary process should be implemented. Employers will also be responsible for persistent age-related harassment of their staff by third parties, such as customers and suppliers. Liability will arise where: a third party harasses an employee in the course of his or her employment (which could be, for example, during a work-related social event); the employer knows that the employee has been subjected to harassment on at least two previous occasions (whether or not by the same third party); and the employer has not taken reasonable steps to prevent the harassment from occurring again. The three instances of third-party harassment do not need to have occurred within any particular time period for liability to be incurred. It is recommended that line managers take action to prevent harassment from occurring again as soon as they know about the first incident of harassment.

6 Victimisation Victimisation occurs where an individual is treated detrimentally because he or she: has made a complaint, or intends to make a complaint about age discrimination or harassment; or has given evidence or information in connection with another person's complaint about age discrimination or harassment. An employee might, for example, complain to HR that he has been passed over for promotion because of his age. This is a complaint about age discrimination. If, following an investigation by HR, the line manager finds out about the employee's complaint and reacts by "cold shouldering" him and giving him a lower grade of work than usual, this would be victimisation. If, during the HR investigation, another employee in the team was interviewed and stated that she agreed that the first employee should have been promoted, and the manager responded by sacking her, this would also be victimisation. 3. Lawful discrimination If an employee is harassed or victimised, this is unlawful. However, where either direct or indirect age discrimination occurs, the discrimination may be lawful if any of the following apply. Justification Both direct and indirect discrimination can be justified. If the discrimination can be justified, it is lawful. The fact that direct age discrimination is capable of justification is a key difference between age discrimination and other forms of discrimination, such as race and sex. In the other areas of discrimination, only indirect discrimination can be justified. A potentially discriminatory measure will be justified if the employer is trying to achieve a "legitimate aim" and the employer's approach is a proportionate means of achieving this aim.

7 This means that: there must be a genuine business need behind the measure (such as health and safety reasons or training requirements); the measure must, in practice, demonstrably contribute to the achievement of that business aim; the measure must be appropriate, when the importance of the business aim is weighed up against the discriminatory effects; and there must not be another, less discriminatory, way of achieving the same aim. In practice, if a line manager thinks something may involve direct or indirect discrimination, he or she should consider the following: What is it that could be either direct or indirect discrimination? What is the purpose of the discrimination? Is there a real business reason or need behind it? What are those reasons/real business needs? These should be set out clearly. Is there evidence to support these reasons or do they simply rely on a set of assumptions? If they rely on a set of assumptions - for example, that people over the age of 40 will not be sufficiently flexible for a particular role - it is unlikely that the discrimination will be justifiable. When the discriminatory effects are weighed against the employer's reasons/real business needs, is the discriminatory effect proportionate? Is there a non-discriminatory or less discriminatory way of achieving the same effect/business need? It is advisable for the line manager to document the process and ensure that someone else is involved in the exercise. Occupational requirements If an employer applies a requirement for an employee to be of a particular age group, this will not be discriminatory in certain circumstances. It will be lawful if the employer can show that, having regard to the nature and context of the work, it is an occupational requirement (so the requirement to be of a particular age group is crucial to the post) and the employer can justify the requirement. An employer will be able to justify the requirement if it is a proportionate means of achieving a legitimate aim. For example, if a TV programme needed a "granddad", applications from 16-yearolds could be lawfully turned down, provided the employer could justify the requirement. In practice, there will be very few situations where this defence will be successful, even in sectors such as fashion sales.

8 Compliance with the law If an employer discriminates against an employee because it is complying with the law, this will be lawful discrimination. For example, it would be lawful for an employer to refuse employment behind a bar to someone under the age of 18, as people of this age cannot lawfully sell alcohol. Service-related benefits Many companies make benefits available to their employees on the basis of length of service. Common examples are eligibility for private health insurance after one year or eligibility for a long-service award after 10 years. All of these benefits are potentially indirect discrimination. Although such policies are applied to all employees equally, they are likely to disadvantage younger individuals, as they are more likely than older employees to have been in the workplace for only a short period of time. However, two specific exemptions from the age discrimination legislation apply to service-related benefits, so they may be entirely lawful. First, all benefits that accrue in the first five years of service are completely exempt. For example, where employees become eligible for private health insurance after one year, this will be entirely lawful as the benefit accrues within the first five years of service (in this case, after the first year). A long-service award paid on five years' service would also be entirely lawful. However, a long-service award paid after 10 years of service would not come under this exemption, as it accrues after the first five years of service. Second, all benefits that accrue after five years of service can be justified by the employer. However, the test that is used for this justification is easier to meet than the general objective justification test set out above. The test has two stages: The employer's policy for the benefit must be based on a business need - such as encouraging the loyalty or motivation, or rewarding the experience, of some or all workers. The employer must reasonably believe that the way in which the length of service criterion is used fulfills this need.

9 Using the example of the long-service award after 10 years' service, an employer should be able to justify this, provided that it can show that it has considered what it is trying to achieve through the awards - rewarding loyalty and encouraging retention - and it has good reason to believe that making the awards after 10 years of service does actually fulfill these objectives. This might be documented by, for example, an exchange of memos between HR and the board director responsible for HR, who will have knowledge of the workforce, their reaction to the policy, and whether or not it does encourage retention. Redundancy payments When employees are made redundant, so long as they have two years' service, they are entitled to a statutory redundancy payment by law. Such payments are calculated by a formula set out in employment legislation. This is one week's pay (capped at 400) for each year of service, multiplied by 1.5 for years of service when the employee was aged 41 or over and by 0.5 for years of service when the employee was aged 21 or under. Such payments are clearly potentially discriminatory. Older individuals have an advantage because they are more likely to have been in the workplace longer than younger employees and are therefore likely to receive a higher payment (indirect discrimination against younger employees). Older employees also receive a higher multiplier than younger employees (direct discrimination). However, because of a specific exemption from the age discrimination legislation, the payment of statutory redundancy payments is lawful. In addition, it is also lawful for an employer to enhance statutory redundancy payments by: increasing or removing the 400 cap; and/or multiplying the appropriate amount allowed for each year of service by a figure of more than one; and/or multiplying the total amount of the redundancy payment by a figure of more than one. Only statutory redundancy payments, or payments that enhance a statutory redundancy payment as set out above, will be lawful. Any other enhanced redundancy payment formula that an employer may have will not be automatically lawful, and will need to be objectively justified under the general justification test.

10 It should be possible to justify the most common types of redundancy scheme, such as those where all employees are paid, for example, four weeks' salary for each year of service. However, schemes that use different age bands to the statutory scheme may be more difficult to justify. 4. Recruitment In general, it is unlawful to discriminate on the basis of age: in relation to any arrangements for determining who will be offered a job; by not offering a job; or in relation to the terms on which a job is offered. However, it is permissible not to offer employment to an applicant who has reached the employer's normal retirement age of 65 or over or 65 if the employer has no normal retirement age, or who is within six months of this age. So, for example, if an applicant aged 70 applies for a job with an employer that has a normal retirement age of 65, the employer is able to refuse the applicant lawfully because of the applicant's age. However, managers should note that, if such an applicant is actually offered employment, it must be on the same terms as would have been offered to a younger individual. Advertising jobs When writing job adverts, line managers should bear the following general points in mind. Job advertisements should identify the skills and capabilities needed for the role. They should not use language that either states or implies that someone of a particular age would be preferred or should apply. For example, an advertisement should not state that a young, energetic person is required for the role. This would be evidence of direct discrimination - that older people would not be considered for the role because of their age. Managers should ensure that job advertisements are aimed at those with the relevant skills and capabilities, not those of a certain age. If, for example, an advert is placed only in a magazine that is mainly read by people aged this could lead to an inference that the employer intended to discriminate directly against individuals of ages outside this age bracket.

11 Managers should also be careful if they wish to aim an advert at a particular level of experience. For example, an advertisement that states that two years' experience is required could be discriminatory, although the discrimination may be justifiable. Line managers should consider whether two years' experience is really required or whether it would be possible to outline the expertise/capabilities required instead. In the past many job adverts also stipulated an "upper" experience limit, for example "two to four years' experience required". Managers should consider whether an upper age limit is required and, if so, why. It is likely to be difficult to justify an upper age limit. As long as the individual is able to do the job for which the company is recruiting, why should it matter if he or she has other experience too? Where managers do refer to years of experience, they should always indicate that this is a "guideline". The following table gives some examples of typical language used in job advertisements that could constitute age discrimination: Don't include Do include The skills and capabilities required for the role. Two to four years' experience is required. A young, energetic person is required. Consider: do you need to specify the years of experience? In particular, why do you need the upper limit? If it has to be retained, state that this is a guideline only. The skills and capabilities required for the role. The skills and capabilities required for the role. The upper age limit for applicants is 55. Applicants should list their GCSE results. Remember, any upper age specified should be no lower than six months before the age of 65, or before the employer's normal retirement age if this is higher. Applicants should list their qualifications.

12 Recruitment agencies Where line managers are using an agency to recruit for a vacancy, they should be aware that their company could be liable for any discriminatory act by the employment agency. It is therefore important for line managers to ensure that agencies are given clear information about the job, and the skills and capabilities required. They should instruct the agency to focus on these skills and abilities and not to provide applicants' age details. In addition, they should check the terms of business between the company and the agency to ensure that the agency will cover any claims brought against the company as a result of the acts of the agency. Application forms Where employers use application forms, some general rules should be followed. It is not, in itself, discriminatory to ask for applicants' age. However, an applicant may state a belief that his or her lack of success was down to age, and use the fact that the employer asked for it as evidence of discrimination. To avoid this risk, an applicant's age can be requested at a later stage in the process, once the decision on whether or not to hire him or her has been taken. Alternatively, an applicant's age can be requested on a separate diversity monitoring form, so that the shortlister or interviewer does not see it. Application forms should ask for information on periods and/or dates of previous employment only if these are required to assess whether applicants are suitable, and have the skills and capabilities, for the role. Otherwise this could be seen as a 'backdoor way' of trying to discover an applicant's age and may lead to an inference of an intention to discriminate. Requests for details of qualifications should not suggest that certain age ranges are favoured, for example asking candidates to list GCSEs, when older applicants will have O Levels.

13 Shortlisting When reviewing applications for a role, it is important for managers to bear key points in mind. They should be careful: to base decisions on the skills and capabilities that the applicants have, compared against the skills and capabilities required for the role; to keep written evidence to show that this has been done; not to base decisions on age or perceived age - even where applicants do not give their age, it is easy to make assumptions based on, for example, hobbies that they have listed; and if it is apparent from any information provided that an applicant is within a certain age range, to eliminate this fact from the decision-making process. Interviewing The key purpose of an interview is to assess the applicant based on the skills and capabilities required for the role and the skills and capabilities that the individual has. It would not be appropriate to ask about an employee's racial background or plans to have a family; asking age-related questions is seen by the law as equally unacceptable. Don't say You seem a lot younger than your CV indicated. You are very young. Do you think that you would be able to manage people far older than you? This role requires someone who can adapt quickly to new methods and absorb training. Do you think that you are too old to be able to do that? Do say No substitute. This is not something that should affect the decision-making process. This role involves management responsibilities. Talk me through your management experience. Give me some examples of when you have been asked to change your role/been given training, and describe how you adapted to it.

14 5. Training Line managers should ensure that all employees who report to them are aware of opportunities for training. Training should be made available to all employees on a fair and equal basis, regardless of age. Line managers should not, for example, assume that there is no point in training older employees because they will be retiring relatively soon and the company will gain little value from their training. Line managers should ensure that arrangements for training do not disadvantage certain employees. For example, if training is offered only in the evening, this may favour younger or older employees and may amount to discrimination against those in the age group that typically has childcare responsibilities. 6. Promotion When making promotion decisions, it is important for managers to bear key points in mind. They should be careful: to base decisions on the skills and capabilities that employees have, compared against the skills and capabilities required for the role; to keep written evidence to show that this has been done; not to base decisions on the age or perceived age of individuals; and not to make stereotypical assumptions about individuals because of their age. 7. Retirement Employers may have a normal retirement age of 65 or above. If an employer does not have a normal retirement age, the age discrimination legislation sets a default normal retirement age of 65. Any normal retirement below 65 will be unlawful unless it can be objectively justified. However, it is likely to be very hard to justify a normal retirement age below 65. It might, however, be possible to justify a lower retirement age on health and safety grounds where the job is particularly physically demanding. Line managers should be aware that employees' contracts of employment cannot automatically be terminated when they reach the normal retirement age. Instead, the statutory retirement procedure, which is set out in legislation, must be followed. A dismissal for retirement will be fair, and will not amount to age discrimination, if the necessary procedural requirements have been followed.

15 The employee should be given written notification of the intended date of retirement six to 12 months in advance of this date. In the written notification the employee should be informed that he or she has the right to request to carry on working beyond retirement. If the employee wishes to request to carry on working beyond retirement, he or she should do so in writing no earlier than six months and no later than three months before the proposed retirement date. The request may be to continue working indefinitely, for a stated period, or until a stated date. The employee should be invited to a meeting to discuss the request within a reasonable period. As soon as reasonably practicable after the meeting the employee should be informed of the decision, and that he or she has the right to appeal against it. Line managers do not have to give a reason for turning down requests from employees to work beyond retirement. Abolition of default retirement age The Government has confirmed that from 6 April 2011, employers will no longer be able to issue new notifications of retirement on the basis of the default retirement age and that the statutory retirement procedure will be abolished. Employers will still be able to operate a contractual retirement age, provided that it can be objectively justified. Only in the most exceptional cases would employers be able to justify objectively a standard retirement age. There will be a transitional period from 6 April Retirement notifications issued on or before 5 April 2011 will be valid provided that the employer follows the statutory retirement procedure and the person retiring reaches 65 on or before 30 September Redundancy Line managers should ensure that the criteria used to select individuals for redundancy are not discriminatory. Employees should not be selected for redundancy because of age. If two redundancies need to be made out of a workforce of 10, selecting the oldest two purely on the basis of their age would be direct age discrimination.

16 Line managers also need to be careful in using selection criteria that appear to apply equally to employees of all ages, but in fact disadvantage employees of a certain age. For example, using "last in, first out" could amount to indirect discrimination. This is because it is likely that younger employees will have been in the workplace for a shorter amount of time than older employees and will therefore be disadvantaged by this criterion. Selecting employees for redundancy solely on the basis of their length of experience could also amount to indirect discrimination, as younger employees could be disadvantaged. However, it might be possible to justify this on the basis of a business need, i.e. because the company needs experienced individuals who have been fully trained. However, whether or not this is the case will depend on the particular circumstances. In order to reduce the risks of allegations of age discrimination in connection with redundancies, line managers should ensure that selection criteria focus on matters such as skills and performance, and the future needs of the business. 9. References When providing references, line managers should ensure that they do not discriminate against individuals because of age. For example, a manager should not refuse to provide a reference for someone because he or she considers that the individual in question is too old to continue working. Managers should avoid making statements or assertions based on an individual's age or any stereotypes that they associate with that age.

17 The Default retirement age Q and A Q. What is the last date employers can notify an employee of retirement using the default retirement age? A. The final date that employers will be able to give between six and 12 months notice of retirement using the default retirement age and statutory procedure is 5 April They will have to be able to justify objectively any compulsory retirement notified from 6 April 2011 onwards. Q. Can employers issue a retirement notice using the statutory procedure for any older employee, so long as they do so by 5 April 2011? A. No. The employee must already have reached 65 (or the employer s normal retirement age if this is higher), or be going to reach this age by 30 September Employers will not be able to retire anyone under the statutory procedure whose 65th birthday is on or after 1 October Q. What do employers have to do to comply with the statutory procedure for any retirements that they notify by 5 April? A. Inform the employee in writing of the date when his or her employment will terminate by reason of retirement and of the right to make a request to carry on working beyond the intended retirement date. The intended retirement date can be between six and 12 months from when they give the notification. Q. So when is the last intended date of retirement possible? According to the Department for Business, Innovation and Skills, 5 April 2012 where the employer gives the maximum 12 months notice on 5 April Q. Suppose the employee requests to continue working beyond his or her retirement date? A. Unless the employer agrees to the request without this being necessary, it must hold a meeting to discuss the request with the employee. The employee has the right to be accompanied at the meeting by a colleague of his or her choice. The employer must then let the employee know the outcome in writing. If it refuses the request, or agrees to extend the employment for a shorter period than requested by the employee, it must also inform the employee that he or she has the right to appeal. If the employee appeals, the employer needs to hold a further meeting before making a final decision.

18 Q. Are there rules on when the employee must make a request to continue working? A. Yes, an employee who wants to request to continue working must notify the employer more than three, but not more than six, months before the proposed retirement date. As we said, the last date on which an employee can be given notice of retirement under the statutory procedure is 5 April 2011, and this could be up to a year s notice, making a retirement date of 5 April Therefore, the last date on which an employee in these circumstances can make a statutory request to continue working is 4 January 2012 (i.e. the final date more than three months before the proposed retirement date). Q. If an employer agrees to an extension of employment will it still be able to retire the employee safely? A. That depends. If the employer agrees to an extension of six months or less, the retirement can simply go ahead under the statutory retirement procedure at the end of the extended period. However, if the employer agrees to an indefinite extension, or to an extended period of more than six months, a new notification of retirement and repetition of the retirement procedure would be necessary if it subsequently wanted to retire the employee. But, of course, it will not be possible to give notification of retirement under the statutory procedure after 5 April So if the employer agrees to an extension of more than six months it will not then be possible for it to retire the employee under the statutory retirement procedure. Q. So where an extension is agreed, what is the last possible date for a retirement under the statutory procedure? A. According to the Department for Business, Innovation and Skills, the last date for a retirement to take place under the statutory procedure is 5 October This would be where the employer gave 12 months notice on 5 April 2011 of a retirement date of 5 April 2012, and then agreed to an extension of six months.

19 The abolition of the default retirement age will have a huge impact on how employers operate their businesses. The Employment Equality (Repeal of Retirement Age Provisions) Regulations 2011 take effect from 6 April The default retirement age is going to be abolished. The Government has committed to removing from 1 October 2011 the default retirement age, which allows employers to require employees to retire at the age of 65 or over provided that the statutory retirement procedure is followed. Important: The information in this article has been updated to reflect the revised draft Regulations that were published on 2 March There were some changes to what was previously stated in the Acas guidance on the repeal of the default retirement age produced in January 2011 (as a result of the Government having worked closely with Acas according to Phasing out the default retirement age: Government response to consultation (PDF format, 111K) (on the BIS website)). The Acas guidance previously stated that "the last day that employees can be compulsorily retired under the default retirement age is 30 September, so the last day to provide six months' notice required by the DRA provisions is 30 March 2011" and "employers can still use the DRA between 30 March 2011 and before 6 April 2011 but if they do they must use the short notice provisions". The Acas guidance Working without the default retirement age (PDF format, 856K) (on the member s space of our website and the Acas website) has now been changed and reflects the content of the draft Employment Equality (Repeal of Retirement Age Provisions) Regulations The statutory retirement procedure is also being scrapped. The current procedure requires employers to: give employees approaching their retirement age between six and 12 months' notice of their proposed retirement date; notify employees that they have the right to request to continue working beyond their proposed retirement date; and consider such requests. Under the new rules, an employer that wishes to retire an employee will instead have to be able to justify the retirement age and follow a fair procedure under the ordinary unfair dismissal rules. If the employer can justify the retirement, it will be considered a dismissal for "some other substantial reason" under the unfair dismissal rules.

20 3. Transitional retirement arrangements are in place from 6 April The Regulations contain transitional provisions to allow the default retirement age and the statutory retirement procedure to be phased out. The last date on which an employer can give an employee notice of retirement under the default retirement age is 5 April However, the draft Employment Equality (Repeal of Retirement Age Provisions) Regulations 2011 provide that, during the transitional period, retirements that were already in motion can continue through to completion, provided that: the employer issues the notification of retirement prior to 6 April 2011; the employee will reach age 65 (or the employer's normal retirement age if that is higher) before 1 October 2011; and the requirements of the statutory retirement procedure are met. The employer must give the employee between six and 12 months' notice of retirement. This notice can expire after 30 September 2011, as long as the employee is 65 (or the employer's normal retirement age if that is higher) on or before this date. 4. Employers will have different options for dealing with retirement. Employers will still be able to operate a compulsory retirement age, provided that they can objectively justify it. The Government's proposals call these "employerjustified retirement ages" (EJRAs). To justify a compulsory retirement age, the employer must be able to show that it is a proportionate means of achieving a legitimate aim. Employers that do not operate a compulsory retirement age may be able to carry out individual retirements on a case-by-case basis, but it will be difficult to justify such a retirement where the employer does not consistently apply an EJRA to all employees in similar roles. An employer that wishes to retire an employee will also have to follow a fair procedure under the ordinary unfair dismissal rules. If the retirement is objectively justified, the dismissal will be deemed to be for "some other substantial reason" under s.98 of the Employment Rights Act 1996.

21 5. Employers will have to think more carefully about the reasons for retiring employees. Under the statutory retirement procedure, an employer that ends a worker's employment by reason of retirement does not have to provide him or her with reasons. The employer is simply obliged to follow the prescribed "duty to consider" procedure. As long as the procedure is complied with in full, the employer is able to refuse to permit an employee to continue working beyond retirement age and is not under any duty to provide a reason for the refusal. Once the statutory retirement procedure is scrapped, an employer that wishes to dismiss an employee will have to be able to show that it has one of the potentially fair reasons for dismissal set out in s.98 of the Employment Rights Act 1996 (capability, conduct, redundancy, illegality or some other substantial reason). Where an employee is being retired at the employer's retirement age, and this can be objectively justified, he or she will be seen as being dismissed for some other substantial reason. An employer that wishes to dismiss an employee due to poor performance will have to do so on the ground of capability. To rely on capability as a ground for dismissal, the employer must have evidence of poor performance and have followed a fair procedure. 6. Employers will have to justify objectively retirement ages. Employers will still be able to operate a compulsory retirement age, provided that they can objectively justify it. To justify a compulsory retirement age, the employer must be able to show that it is a proportionate means of achieving a legitimate aim. "Proportionate" means that: what the employer is doing is actually achieving its aim; the discriminatory effect should be significantly outweighed by the importance and benefits of the legitimate aim; and the employer should have no reasonable alternative to the action that it is taking. An aim could be "legitimate" if it relates, for example, to: economic factors such as the needs of and the efficiency of running a business; the health, welfare and safety of the individual (including protection of young people or older workers); or the particular training requirements of the job.

22 The aim of saving money by getting rid of older workers (who might, for example, be paid more than a younger worker) is not by itself a legitimate aim. Employers will also not be able to rely on generalised assumptions that lack any factual foundation as sufficient evidence of justification. They will have to provide valid evidence if their retirement ages are challenged. 7. Case law gives employers clues as to how retirement ages can be objectively justified. As the default retirement age allows employers to have a compulsory retirement age of 65 that they do not currently have to justify, case law exploring how individual employers can objectively justify retirement has been rare. However, a Court of Appeal case involving a partner (rather than an employee) in a law firm who was forced to retire, Seldon v Clarkson Wright and Jakes [2010] EWCA Civ 899 CA, gives employers an idea of what might constitute objective justification. The Court of Appeal said that it could be a legitimate aim to avoid forcing an assessment of a person's falling off in performance, thus maintaining a confrontation-free workplace. The Employment Appeal Tribunal in the same case had earlier held that ensuring that associates have the opportunity to become a partner after a reasonable period and facilitating the planning of the partnership and workforce across individual departments could also be legitimate aims. 8. Time is running out to retire employees under the statutory retirement procedure. Employers should note the following key dates in relation to the Government's proposals under the draft Employment Equality (Repeal of Retirement Age Provisions) Regulations 2011: 5 April 2011: This is the final date on which employers will be able to issue between six and 12 months' notice of retirement under the statutory retirement procedure. 6 April 2011: Employers will have to be able to justify objectively any compulsory retirements notified on or after this date.

23 30 September 2011: Employees who are to be retired under the statutory retirement procedure must have reached age 65 (or the employer's normal retirement age if that is higher) on or before this date. 4 January 2012: This is the last date on which an employee who has been given the maximum 12 months' notice on 5 April 2011 can make a statutory request to continue working. 5 April 2012: This is the last date on which a retirement can take place under the default retirement age regime, unless the employer agrees to extend the employee's employment (i.e. this is the date (according to the Department for Business, Innovation and Skills (BIS)) on which 12 months' notice that was given on 5 April 2011 will expire). 5 October 2012: This is the last date on which a retirement can take place under the default retirement age regime where the employer has given the required notice and then agreed to the employee's request to extend his or her employment past the proposed retirement date (i.e. this is the date (according to BIS) on which the employee would retire if the employer agreed to an extension of six months (the maximum extension allowed without the employer having to repeat the statutory retirement procedure) from a proposed retirement date of 5 April 2012, notified on 5 April 2011). 9. Employers need to think about how the timetable will affect their workforce. Each employer should work out when its employees are going to retire and how the proposals affect retirements within its organisation. The Acas guidance gives examples to assist employers. The most common scenario will be that the employer has a compulsory retirement age of 65. Two examples show how this will work in practice: Employers with a retirement age of 65 can still use their compulsory retirement age to retire employees who have their 65th birthday on 30 September 2011 or any earlier date, provided that they give notice of retirement before 6 April 2011, and they follow the statutory retirement procedure. This avoids the problem of having to justify objectively the retirement. For employees who have their 65th birthday from 1 October 2011 onwards, employers will have to justify objectively the retirement. They must follow a fair procedure under the ordinary unfair dismissal rules.

24 10. Employment tribunal claims in relation to retirement will be common after the changes come into force. Employers are going to face the double threat of age discrimination and unfair dismissal claims from employees who have been compulsorily retired. Direct and indirect age discrimination claims are likely to revolve around whether or not the employer was objectively justified in requiring the employee to retire. With unfair dismissal claims involving retirement, the key issues will be whether or not the employer had a fair reason for dismissal and followed a fair procedure once the decision was made to dismiss the employee. If the dismissal is an objectively justified retirement, it will be deemed to be for "some other substantial reason" under s.98 of the Employment Rights Act 1996.