An Employment Appeal Tribunal has ruled (Friday 20th December) that the retirement of office holders can in principle be justified at 65 but not on the basis of stereotypical assumptions that a workers' capability is reduced at that age.

Employment Appeal Tribunal President Mr Justice Elias made his ruling in the case of Seldon v Clarkson, Wright and Jakes. This was the first case about the compulsory retirement of non-employee workers (judges, magistrates, contract workers, police, barristers etc) to reach the EAT since the enactment of the Employment Equality (Age) Regulations 2006. The Equality and Human Rights Commission also intervened in the case in order to obtain clarification on the law.

The regulations state that whilst employees can be retired at 65 or over as long as proper procedure is followed, other workers aged 65 cannot be forced out unless the employer can show "objective justification".

Originally, the Employment Tribunal had ruled that whilst the compulsory retirement of Leslie Seldon had been discriminatory on grounds of age, that the dismissal had been a proportionate means of achieving a legitimate aim. Justification had in part relied on an assumption that the quality of an individual's work is reduced once they pass 65.

The EAT judge however did not allow that decision to stand. Specifically, Employment Appeal Tribunal President Mr Justice Elias, rejected the argument of Solicitors' firm Clarkson, Wright and Jakes that partners should be retired at 65 because their performance "dropped off" from that age. Justice Elias said "there was no evidential basis for that assumption". Justice Elias remitted the case back to the original tribunal to assess whether there were other reasons which could justify their retirement age of 65.

Employment and discrimination barrister from Cloisters, Schona Jolly said:

Decisions on age discrimination are slowly beginning to creep in.

This decision, concerning the compulsory retirement of partners from a solicitors' practice, provides welcome guidance on the need for tribunals to avoid making age stereotypical assumptions about those reaching retirement age.

In particular, it ought to warn employers off from making unfounded assumptions that a person's work performance drops away at around age 65. This case usefully recognises the importance for unjustified stereotypical thought connecting age and lacklustre performance or drive to be challenged, so that fundamental notions of dignity and equality are advanced in our workplaces.

Solicitors will find the case interesting because it upholds the right of partners to agree a retirement age based on legitimate aims. It upholds the principle that a partnership agreement is a commercial agreement between persons of equal bargaining power. Therefore their agreement of a retirement age can be taken into account to justify the partner's retirement age.

However, solicitors must be careful not to base a retirement age on an assumption that capability declines as the partner reaches the age of 65.

The Employment Appeal Tribunal also drew some more general conclusions about the test for justification in age discrimination.
Schona Jolly added:

The judgement also provides a useful discussion about the test for justification in age discrimination and provides some clarification on the issue.

Whilst the Tribunal rejected a formal difference in the test for justification between direct age discrimination and indirect as had been argued for by the ERC it did say that where treatment is directly based on age this may be considered as having a greater discriminatory effect than a neutral criterion. Employers may, in general terms therefore, find it more difficult to justify direct age discrimination than indirect.