Recent Equality Decision of Interest on Compulsory Retirement

Friday, March 14, 2014


In the 2012 case of Paul Doyle –v- ESB International Limited DEC--2012-086, the complainant had been employed by ESB as a graphic designer for approximately 13 years. Mr Doyle stated that he became aware of his compulsory retirement when an email was circulated announcing his retirement and inviting him and his colleagues for drinks to mark his departure.

In his claim for discrimination on grounds of age before the Equality Tribunal, Mr Doyle argued that he was not subject to any contractual compulsory retirement age. ESB argued that retirement at 65 was a long established custom and practice in the organisation and they were further in a position to show that only in exceptional circumstances were employees over the age of 65 re-engaged on fixed term contracts for project purposes. It was also noted that Mr Doyle was a member of the company pension scheme which provided for retirement between the ages of 50 and 65. 

The extensive cases emerging from the Equality Tribunal over the past year have made clear that although section 34(4) of the Employment Equality Act states that “it shall not constitute discrimination on the age ground to fix different ages for the retirement (whether voluntarily or compulsorily) of employees or any class or description of employees”, the Tribunal will interpret this provision in light of the European Directive from which it is derived. On that basis, employers have been obliged to objectively justify their compulsory retirement ages in order to successfully defend against a claim of discrimination on grounds of age. 

Very interestingly in this case, ESB’s two arguments as to objective justification were accepted by the Equality Officer. ESB’s main argument was that fixing a retirement age of 65 was necessary to provide promotional opportunities and career pathways in order to retain younger employees. ESB was in a position to show that it allocated extensive resources to training its staff who, as a result, were very mobile and if they could not progress internally, they would move elsewhere, resulting in the loss of an important resource. The Tribunal accepted that the notion of “sharing employment between generations” has been found to be objectively justifiable by the European Court of Justice. On this basis, Mr Doyle’s claim failed. 

In addition, ESB argued that work involving electricity is of such a nature that legitimate health and safety concerns in respect of older staff may arise. It was submitted that increasing the retirement age would necessitate physical examinations that might cause embarrassment and humiliation to employees. While this did not apply to Mr Doyle, the Equality Officer nonetheless noted that a legitimate employment policy means that an employer is entitled to maintain a retirement age that ensures cohesion amongst all its employees. It was accepted that having different rules of retirement may threaten cohesion and open up other areas of discrimination (presumably disability discrimination, based on ESB’s argument). 

A significant number of cases before the Equality Tribunal for age discrimination arising out of compulsory retirement, have been lost where the employer cannot show that they have carefully considered the reasons as to why their retirement age is capped and that there is a clear employment policy supporting that cap. Decisions such as that in the Doyle case will prove very useful guidance for employers seeking to understand what will be accepted as objective justification by the Equality Tribunal.

Jennifer has wide ranging experience in all aspects of employment law and practical HR matters including drafting and negotiating contracts, review and audit of client policies and procedures, and the management of ongoing employee issues.  Jennifer also advises private and public sector clients in relation to the conduct of internal investigations, disciplinary and appeal procedures and has sat in an advisory role on panels in the course of these processes.