Alison Martin: Is your mandatory retirement age objectively justifiable?
DWF associate Alison Martin and trainee solicitor Thomas Bulfin examine a recent case involving an employer with a mandatory retirement age.
In the recent Workplace Relations Commission (WRC) case of Joseph McGrath v Focus Ireland ADJ-00018823, the adjudication officer considered the issue of objective justification in relation to the employer’s mandatory retirement age.
Mr McGrath (the complainant) was employed by Focus Ireland (the respondent) on a two-year fixed term contract. During the two-year fixed term, the complainant turned 65 and then 66 on the 23rd April 2018. His employment ended on 20th June 2018 at the end of the fixed term and the respondent did not renew the complainant’s contract nor did they consider his application when they advertised for the role again. The complainant claimed this amounted to age discrimination. The respondent denied the allegation and said that it had a mandatory retirement age of 66 which applied to all staff.
Summary of complainant’s case
The complainant was hired in 2016 to oversee a new project involving mediation with families to prevent homelessness. The complainant turned 65 during the first year of the contract and received a phone call from HR stating he would have to retire at that point. The complainant responded that he needed more time to develop the project (which at that point had funding for a period of 5 years) and the respondent agreed to allow him to work beyond 66, to see out the two year contract.
The complainant’s project involved introducing a form of mediation that had not been used before in Ireland. In January 2018, the respondent published a report on the project stating ‘the mediation service had proven to be an effective service which is delivering effective change in the lives of young people’. A second mediator was appointed and the complainant mentored this person.
In February 2018 the respondent emailed all staff to inform them that the compulsory retirement age in the company was 66. The complainant also received a phone call that day acknowledging that he would turn 66 on 23rd April 2018. The complainant’s role was then advertised internally and he applied on for the role on the 11th April 2018. He was the only applicant. He received an email on the 4th of May 2018 stating that his application had not been processed. The complainant applied again at later date as an external candidate but was told he was not eligible because of his age.
The complainant submitted that the respondent had acted in breach of the Employment Equality Acts 1998-2015 and that it has not provided an objective justification for the ending of his employment. He submitted that the Acts imposed the same obligation for objective justification to fixed term contracts as it did for permanent contracts. He acknowledged that his contract would expire at the end of the fixed term, but claimed that not considering him for the role was an act of discrimination.
Summary of the respondent’s case
The respondent rejected the complaint of discrimination and submitted that the complainant had a two year fixed term contract that ran until its expiry in June 2018. The respondent claimed that the complainant’s employment ended because his fixed term contract ended and not because of his age.
In an email dated 4th May 2018 the respondent acknowledged the complainant’s application for the role but informed that he would not be called to interview because he had reached retirement age. The respondent submitted there was no discrimination in this case. It claimed that the decision not to retain the complainant was based on a legitimate aim - preventing disputes regarding an employee’s fitness to work and to protect the dignity of employees. It asserted that it had a retirement age of 66 which applied to all staff. The complainant’s employment terminated at the end of the fixed term and his subsequent application was not considered as he was then above the retirement age. The respondent also said that it was justified by the complainant’s entitlement to pension.
The respondent also submitted that the fact that the project the complainant oversaw was set to continue beyond the two years, did not oblige them to retain him.
Section 6 of the Acts provides that discrimination shall be taken to occur where a person is treated less favourably than another person on one of the discriminatory grounds, including age.
Section 34(4) of the Acts permits an employer to fix different ages for retirement, again, where it is objectively and reasonably justified by a legitimate aim and the means of achieving that aim are appropriate and necessary.
Section 6(3) of the Acts provides that offering a person over the retirement age a fixed term contract shall not constitute age discrimination provided it is “objectively and reasonably justified by a legitimate aim, and the means of achieving that aim are appropriate and necessary”.
The first issue the adjudication officer considered was whether the complainant’s contract was subject to retirement age. The adjudication officer concluded that although the retirement age was not written in the contract, the respondent had fixed the retirement age at 66, based on the email to all staff sent in February 2018.
The adjudication officer noted that the Acts permit differential treatment of employees according to their age if it is justified by a legitimate aim and the means of achieving that aim are proportional to the objective. The adjudication officer held that the aims relied on by the respondent – relating to fitness and dignity were legitimate. However, he found that the means used to achieve those aims were not appropriate or necessary. The adjudication officer stated that fitness could have been gauged in alternatives ways rather than just age. The adjudication officer also referenced the success of the project and the complainant’s role in this success.
He also noted the complainant’s proposal to remain for a further two year period and not for an extended or indefinite period and that the complainant had advanced a strong case to continue for a further two years or some other fixed term.
The adjudication officer ultimately found that the respondent discriminated against the complainant based on his age in not allowing him to continue in employment beyond June 2018.
The adjudication officer noted that the complainant had forged a successful new career and this had been curtailed by discrimination. Since his termination the complainant had explored other opportunities and had been engaged in crisis intervention across many areas and in an approved housing body and charity. The complainant was also in receipt of a pension from his previous employment. Taking these factors into account, the adjudication officer awarded the complainant compensation in the amount of €22,000, representing almost 7 months’ pay.
What this means for employers
In this case the adjudication officer accepted the respondent’s “aims” were legitimate. However, in demonstrating that the means of achieving those aims is both necessary and appropriate, an employer must examine the actual circumstances of the employee’s position. It is not enough to simply cite only the employee’s age.
Employers should consider other potential ways the relevant “aims” might be achieved in the individual circumstances, taking into account the particular role carried out by the employee.