Employment Bulletin - May 2006

Employment Equality (Age) Regulations 2006

The Employment Equality (Age) Regulations 2006 (the ‘Regulations’) are due to come into force on 1 October 2006. They will protect employees, job applicants, and a range of other workers including: contract workers, members or prospective members of a pension scheme, office-holders, the police, partnerships (including limited liability partnerships), trade organisations and employment agencies from discrimination in employment on the grounds of age or perceived age. This will cover recruitment, terms and conditions, opportunities for promotion, transfer, training, dismissal and any other detriment.

For many, the Regulations will have a huge impact and will require a cultural change in the workplace and employers should start the process of change as soon as possible in readiness for the implementation of the Regulations.

There has also been a recent case in the European Court of Justice which suggested that legislation, which is discriminatory on the grounds of age, could already be unlawful if it was implemented after the directive on which the age discrimination regulations are based was introduced, and on the more general basis that age discrimination being unlawful is a general principle of European Community law.

Such a ruling may not have a significant impact prior to the Regulations coming into force, but it is a powerful reminder of how serious such an issue will be taken. Because of the potential impact of these Regulations in all areas of the employment relationship, in this month’s edition, we concentrate exclusively on the new laws and take a look at the main provisions of the Regulations relating to direct discrimination, indirect discrimination, harassment, victimisation and retirement.

Direct Discrimination

Direct discrimination will occur where, on the grounds of age, the employer (A) discriminates against the employee (B) by treating B less favourably than he treats or would treat other persons and A cannot show he has sound (and proportionate) business reasons for the discrimination.

Therefore, refusing to recruit a job applicant because they are either too young or too old will be prohibited. Less favourable treatment on the grounds of age during the employment relationship will also be unlawful.

Where direct discrimination does occur, the employer may be able to justify this by reference to a legitimate and proportionate aim. For example, the employer’s need for there to be a reasonable period of employment before retirement may be a justifiable reason. However, each case will turn on its own facts.

Practical Tips:

• Employers must be aware of the Regulations in respect of their application forms, criteria used in respect of promotion and training opportunities, and job advertisements.
• References to age need to be avoided as do age-related terms. Commentators suggest that terms such as ‘dynamic’, ‘experienced’ and ‘lively’ might well be age discriminatory. In an Irish case, where age discrimination has been unlawful since 1998, an advertisement by Ryanair for a “young, dynamic, professional” was held to be discriminatory.
• HR officers and managers dealing with recruitment, promotion, training and terms and conditions should be given training on the new Regulations.

Where there is a genuine and determining occupational requirement for an individual to be of a certain age, such as in acting, there will be an exemption from the Regulations. This will be extremely rare.

Indirect Discrimination

Indirect discrimination occurs where the employer (A) applies to the employee (B) an age neutral provision, criterion or practice, which puts or would put persons of the same age group as B at a disadvantage, and B is put at that disadvantage, and A cannot objectively justify this (i.e. A cannot show that it is a proportionate means of achieving a legitimate aim as above).

For example, a requirement that an applicant passes a fitness test may have a disproportionate adverse effect on older workers. If the employer could establish that a certain level of fitness was necessary for the role, this may be justified. However, evidence will be required.

Practical Tips:  

• Employers should review any policies, practices, requirements or procedures which could indirectly affect a particular age group.

• When considering the above employers should carefully consider whether any requirements which do impact on a particular age group are necessary, can be justified or if the same objective can be achieved by less discriminatory means. For instance, if five year’s experience is usually required for a post can the same objective be achieved by requiring two years?

Harassment

Harassment is a ‘free-standing’ wrong under the Regulations.

Harassment will occur where a person (“A”) subjects another person (“B”), on the grounds of age, to unwanted conduct which has the purpose or effect of violating B’s dignity; or creating an intimidating, hostile, degrading, humiliating or offensive environment for B. An objective test is applied although the perception of B will be taken into account. An unusually sensitive employee may not be able to establish harassment.

The employer will be responsible for the acts of its employees which are committed during the course of employment. This is the case whether or not those acts have been done with the employer’s knowledge or approval. However, where an employer can prove that he took such steps as were reasonably practicable to prevent an employee from committing a discriminatory act, then he will have a defence to a discrimination claim.

Practical Tips: 

• Employers should ensure, so far as is reasonably practicable, that discrimination in the workplace is not tolerated, whether that be office ‘banter’ or more serious forms of harassment.
• Existing equal opportunities policies should be amended to include reference to age.
• Managers and employees should be made aware of the policies and should be given training on the relevant issues. Refresher training should be given from time to time.

Victimisation

The Regulations will also protect an employee (and others in the employment field) from victimisation (i.e. less favourable treatment) owing to the employee having brought a claim under the Regulations, alleging another has contravened the Regulations or giving evidence in support. In addition, the Regulations contain specific provisions which make it a form of discrimination to treat an individual less favourably because that individual has not carried out an instruction to do an act which is unlawful under the Regulations or has complained about that instruction.

Practical Tips:  

• Employers need to ensure managers and their employees are aware of the Regulations and these particular provisions;
• Clear policies and appropriate training on what the Regulations mean in practice should be given and referred to if an allegation of age discrimination is made.

Exceptions

The Regulations contain a number of exceptions where age discrimination will be permitted such as statutory authority, national security; positive action; retirement; payments in accordance with the national minimum wage legislation; benefits based on length of service; enhanced redundancy payments; and life assurance cover for retired workers.

Employers will be able to continue benefits based on length of service although will have to justify service based benefits which require more than five years’ service. For instance, encouraging the loyalty or motivation of workers.

The Regulations provide two methods of calculating workers’ length of service for the purposes of benefits: the length of time the worker has been working for him doing work which he reasonably considers to be at or above a particular level or the length of time the worker has been working for him in total. It will be for the employer to determine which definition to use.

Practical Tips:  

• Employers need to carefully review any service related benefits which are payable after more than five year’s service.
• When calculating service by reference to a period of time the worker has been required to have a particular level of skill, employers should ensure that this in itself is non-discriminatory (such as reducing length of service due to disability related absences).

Retirement

Employers will have to follow a statutory procedure in order to fairly dismiss an employee on grounds of retirement. An employer will also be under a duty to consider requests to stay beyond retirement. Where an employer fails to comply with the ‘duty to consider’ procedure, the employer can be ordered to pay the employee compensation not exceeding eight week’s pay (subject to the statutory maximum, currently £290). The procedure entails giving the notice of intention to retire the employee within specific time frames, and where a request is made to continue employment, a meeting should be arranged, the employee informed of the decision and, if appropriate, given a right of appeal. There are also transitional provisions in respect of those employees whose intended date of retirement falls before 1 April 2007. Employers should seek legal advice if faced with this situation.

The upper age limit for bringing an unfair dismissal claim (currently, the normal retirement age or the age of 65) is removed by the Regulations. Therefore, failure to comply with the proper procedures could result in a claim for unfair dismissal, and dismissal on other grounds could be discriminatory depending on the circumstances.

Practical Tips:  

• Employers should draw up policies to reflect the statutory procedures to retire an employee and consider requests to remain employed.
• Such policies should be easily accessible to managers and training should be given to managers on how to handle retirement.

In future editions we will continue to provide details of, and commentary upon, these Regulations as their impact cannot be overstated.

If you would like further information on our Employment Unit or to discuss topics covered in this newsletter, please do not hesitate to contact Kevin McKernan, Head of our Employment Unit, or any other member of the team on 0191 233 9700.

The Employment Training Unit provides bespoke training on all employment issues in a practical and comprehensive format. Again, please contact a member of the unit for further details.

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