Victoria Clark: Employers must strike balance in face of equality rights

THE Equality Act came into force in October 2010, with the aim of simplifying and consolidating existing discrimination laws into one statute. But as claims begin to filter through the employment tribunal system, it is becoming apparent that the law is not quite so clear cut. In particular, when defending direct age discrimination claims, what is and isn’t in the public interest is becoming increasingly relevant.

Age is one of nine “protected characteristics” under the Act, meaning that, in most circumstances, it is unlawful to treat people unfavourably because they are either too old or too young. Implementing policies and procedures at work which clearly put certain age groups at a disadvantage is also unlawful if it cannot be justified, and employers who do so are risking tribunal claims.

However, the reality is that to treat people fairly, sometimes you have to treat them differently. But when it comes to running any sort and size of organisation, striking the right balance is proving rather tricky.

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Let me give you an example. Two employees are placed at risk of redundancy and both decide to take advantage of a voluntary enhanced redundancy scheme. One is 26 years old and the other is 35. The former receives almost £11,000 but the latter gets an impressive £28,000. Fair? Yes it is, according to the Employment Appeals Tribunal (EAT) in the case of Lockwood v the Department of Work and Pensions. Because, despite the fact that Ms Lockwood had been continuously employed for almost eight years, her employer and now also the EAT considered her chances of finding another job better than her older colleague. As a result, she received £17,000 less under the redundancy scheme.

Whether you agree or not, the EAT accepted that there are material differences between Ms Lockwood’s age group and those aged over 35. According to statistics, older employees typically find it harder than their younger colleagues to find a new job after being made redundant. Therefore, the EAT suggested in this case that it was entirely fair, justifiable, and in the public interest to offer older employees a larger financial cushion.

Over the past few years, the Supreme Court, following case law in the European Court of Justice, has begun placing greater emphasis on what is considered to be in the public interest. It means that employers may be able to justify treating people differently on the grounds of their age if the difference in treatment promotes a social policy objective. This could be to reduce unemployment, reward employee loyalty or to maintain a balanced and sustainable workforce.

Perhaps greater leeway is afforded in relation to direct age discrimination because, unlike any of the other protected characteristics such as gender and race, old age is something that happens to all of us. So in effect, we will all have the chance to benefit from any preferential treatment on the grounds of age sooner or later.

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Of course, this is not an open door for employers to discriminate against others nor is it encouragement to target older employees in redundancy situations. While the courts are sympathetic to employers facing financial difficulties, such a policy will almost certainly result in unwelcome, costly and time-consuming employment tribunal claims.

Businesses that are currently looking at making redundancies or cost reductions should take care not to taint any dismissals with the age discrimination brush. A fair dismissal for redundancy will only take place after establishing a fair reason, and following a fair consultation process. The “public interest” test means that any trend in the selection of older workers for redundancy must also be objectively justifiable against a social policy objective.

With the level of potential compensation to an employee who successfully claims age discrimination in the employment tribunal uncapped, seeking specialist advice before any redundancy programme begins is always a good idea. That way, your business can spend its time and resources on business development instead of defending avoidable discrimination claims.

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