McGarr v Department of Finance(Represented by the Chief State Solicitor)
1. DISPUTE
1.1 This dispute concerns a claim by Mr Simon McGarr that he was discriminated against by the Department of Finance on the ground of age contrary to the provisions of the Employment Equality Act, 1998, when he was unable to compete for promotion to the grade of Higher Executive Officer because of the eligibility criteria imposed for the promotion competition.
1.2 The complainant referred a claim to the Director of Equality Investigations on 11 July 2001 under the Employment Equality Act, 1998. The initial referral cited the Office of the Civil Service and Local Appointments Commission as respondent. On 23 October 2001, the Department of Finance confirmed that it should be substituted as the correct respondent in the claim, because of its role in determining eligibility requirements for civil service promotions. In accordance with her powers under section 75 of the 1998 Act, the Director delegated the case on 14 January 2002 to Anne-Marie Lynch, an Equality Officer, for investigation, hearing and decision and for the exercise of other relevant functions of the Director under Part VII of the Act. Submissions were sought from both parties and a joint hearing was held on 12 September 2002. Further correspondence ensued with the parties, and a second hearing was held on 16 April 2003. Subsequent correspondence with the parties concluded on 12 May 2003.
2. SUMMARY OF THE COMPLAINANT'S CASE
2.1 The complainant said that he was born on 29 August 1976 and entered the Civil Service on 3 June 2000 as an Executive Officer. On application and on arrival to his first posting he was given a booklet, the Careers' Information Booklet published by the Civil Service and Local Appointments Commission, which described the methods of career progression and promotion in the following terms:
"The days when promotion was mainly determined by seniority are long since past. The principle of promotion by merit is now firmly entrenched. In the general administrative grades there are service-wide promotion competitions at all levels."
2.2 The complainant said it was only when an interdepartmental Higher Executive Officer competition was advertised in January 2001 that he became aware of the eligibility requirements for entry into the competition. Circular 2/2001 said "[Candidates must] on 1 January 2001 have not less than five years' service in their existing grade or an aggregate of five years' service in eligible grades or not less than seven years' total service of which not less than two years was in an eligible grade."
The complainant said he had been provided with figures which confirmed that the bar to promotion to Higher Executive Officer until five years' service had been achieved resulted in age discrimination. The figures showed that 65% of candidates for the grade of Executive Officer were under 30 years of age, and 63.21% of those who qualified from the first round of the assessment process were also under 30 years of age. No figures were available for the second round of the assessment process, but the complainant suggested that it could safely be presumed they were in line with the foregoing.
2.3 By contrast, the complainant said that 8% of Higher Executive Officer candidates and just 2.48% of serving Higher Executive Officers were aged less than 30 years. He said it was clear from those figures that the five-year service requirement resulted in a significant under-representation of candidates under the age of 30 years, and consequently an under-representation of serving Higher Executive Officers under that age. He referred to the definition of indirect discrimination in section 31 of the 1998 Act, and said the five-year service requirement had a more negative impact on persons under the age of 30 years than on persons over that age. He said that the respondent therefore had to show that the requirement was justified in all the circumstances of the case.
2.4 The complainant said that that Department of Finance Circular 2/2001 described the selection process for Higher Executive Officer as being based on a competency methodology with three stages. Stage 1 was a multiple choice Job Scenario Questionnaire, Stage 2 was a project exercise and Stage 3 involved a competitive competency-based interview and an oral presentation to an interview board. He said that this meant that the first two stages were objective tests and the third stage was a carefully structured interview. They were all intent on testing certain skills, which had been identified as vital to the Higher Executive Officer role. These skills he described as innate to the person and not limited to specific skills gained from an arbitrary amount of time spent as an Executive Officer. What was important for assessment was not the sphere in which the skills had been demonstrated, but rather that they had been demonstrated to the necessary standard.
2.5 Given the comprehensive range of tests, and the skills examined by those tests, the complainant said it was clear that only those candidates who had the skills which have been identified as being necessary for the Higher Executive Officer role would be successful. Regardless of their ages, candidates were tested on ability. He said there was nothing to gain by artificially restricting the pool of potential talent, and therefore it could not be argued that this would be a reasonable ground for the eligibility restriction.
2.6 The complainant also pointed out that the question of staff retention and staff turnover had received much attention. A Staff Retention Survey commissioned from Goldman Fitzgerald had stated that career progression was "the most frequently quoted reason as a trigger for departures". The complainant said this showed the inefficiency of the disputed bar to promotion. He said it resulted in a loss of ambitious and energetic people from the Civil Service, and also that it had a demoralising and demotivating effect on those who chose to stay. He said the bar diminished the Civil Service's ability to function effectively by artificially limiting the number of people who could apply for the posts.
2.7 The complainant asserted that the respondent had recognised this in subsequent competitions. In a Higher Executive Officer competition advertised in Circular 10/2002, the eligibility requirement was reduced to a requirement that candidates "have not less that three years' service in their existing grades..." The complainant said that this reduction of the eligibility bar to three years' service as an Executive Officer demonstrated the arbitrary nature of any service requirement being used as an eligibility requirement for promotion.
2.8 The complainant pointed out that he was not claiming to have been discriminated against in the competitive process, but by the rules which prevented him from taking part in the process. He was not stating that he should necessarily be appointed to the grade of Higher Executive Officer. Rather, he sought only the opportunity to compete on a level playing field with other candidates for the "promotion on merit" he was led to expect from Civil Service literature when he joined. He said the use of a length of service rule to determine eligibility for promotion should be abolished, and he should be compensated for the impediment it had caused to his advancement.
3. SUMMARY OF THE RESPONDENT'S CASE
3.1 The respondent's written submission questioned the statistics quoted by the complainant, and suggested that he had not demonstrated their significance in his claim. At the hearing, however, the respondent confirmed that it accepted the premise put forward by the complainant. It was therefore unnecessary for me to seek detailed statistics on ages and grades of staff in the Civil Service.
3.2 The respondent said that the complainant joined the Civil Service on 3 June 2000. On the date he alleged to have been discriminated against (16 January 2001) he had been in the Civil Service for approximately 6½ months. The respondent said that eligibility for application to promotion to Higher Executive Officer in accordance with Circular 2/2001 was confined to those who were serving in an established capacity and who had not less than five years' service on 1 January 2002. The complainant would have had approximately 1½ years service on the relevant date and was not serving in an established capacity. Consequently he was not eligible to compete.
3.3 The respondent noted that the complainant was claiming that he had been indirectly discriminated against on the age ground by virtue of the five-year service requirement. It said that section 34 of the 1998 Act set out a number of exceptions relevant to this claim. The most important of these was section 34 (7) which permitted an employer to provide different rates of remuneration or different terms and conditions of employment, if the difference is based on relative seniority or length of service in a particular post. The respondent said that this provision clearly governed the claim made by the complainant. The difference in eligibility which the complainant claimed to be discrimination was clearly based on the relative seniority or length of service of those Executive Officers who had more than five years' service, and therefore the complainant's claim could not succeed.
3.4 Notwithstanding its reliance on the provisions of section 34 (7) the respondent also addressed the various arguments made by the complainant. In the first place, it said it was relevant to note that promotion to Higher Executive Officer was not the only channel of promotion open to the complainant. He may be eligible to compete in a competition for Administrative Officer, which was the top graduate entry position into the Civil Service. Eligibility was restricted to persons with a second class honours degree or higher, or to established Civil Servants with a minimum of two years' service.
3.5 The respondent also claimed that the opening of eligibility for promotion to Higher Executive Officer to all persons who demonstrated the requisite skills, without necessarily having any experience within the Civil Service, would result in it having to expend considerable resources in training such persons in relation to the ethics, ethos, structures and procedures of the civil service. This would result in a significant increase in costs. There would also be a substantial increase in the cost of running the selection and recruitment process as there would be no limit in the numbers allowed to apply. The respondent claimed that the five-year service requirement also allowed suitability in terms of health to be assessed. In the event of direct entry to the Higher Executive Officer grade, greater costs could potentially be incurred as a result of ill health. With regard to these points, the respondent claimed that such increases in costs not only brought the respondent within the scope of the exemption provided for at section 34 (3) of the 1998 Act, but also constituted objective justification for alleged discrimination.
3.6 Assuming that discrimination for the purpose of the Act existed and that no exemptions applied to such discrimination, the respondent argued that it could justify the indirect discrimination by demonstrating further objective justification of the requirement. In the first place, the respondent said that it was of the view that length of service at the Executive Officer level was necessary to carry out work at Higher Executive Officer level in a satisfactory manner. It referred to the European Court of Justice acceptance of this approach in the case of Handels-og Kontorfunktionaerernes Forbund I Danmark v Dansk Arbejdsgiverforening, acting on behalf of Danfoss (Case C-109/88). The Court said "...since length of service goes hand in hand with experience and since experience generally enables an employee to perform his duties better, the employer is free to reward it without having to establish the importance it has in the performance of specific tasks entrusted to the employee." Consequently, the respondent said it was entitled to take the view that "length of service goes hand in hand with experience" when related to the acquisition by Executive Officers of skills necessary to perform the function of Higher Executive Officer. It said the proportionality of this approach was illustrated by the fact that the same service criterion did not apply for promotion to any other position, and pointed to the two years' service required for eligibility for the Administrative Officer competition.
3.7 The respondent said that service requirements were a standard feature of promotion in the Civil Service, the only exceptions being promotion to the top management tier of Assistant Secretary and Secretary General. The Civil Service trade unions favoured the use of a service criterion when assessing eligibility requirements for promotion. Consequently, and in view of the partnership ethos in Civil Service industrial relations, changes in the length of service requirements were inevitably subject to prior consultation with the representative unions. In the event of the Minister proposing to abolish a service criterion, this would give rise to major difficulties within the Civil Service unions.
3.8 The respondent acknowledged that the eligibility requirement for promotion to Higher Executive Officer was decreased to three years in Circular 10/2002, but denied that this resulted from recognition of the inefficiency of the five-year requirement. It said that there were a variety of reasons for the change, among which was an intention to improve morale and motivation. However, the respondent also acknowledged that Executive Officers recruited to the Civil Service were increasingly more mature and held higher educational qualifications than previously. It acknowledged that the competencies required for the grade could nowadays be built up in a shorter time span than five years. The most fundamental reason for the change, however, was a shortage of supply of Higher Executive Officers. The Civil Service Commissioners, who were responsible for recruitment, had recommended that the service requirement be reduced to increase the pool of applicants. The respondent said that candidates promoted to the Higher Executive Officer grade under the three-year service requirement would be monitored to assess the effectiveness of their job performances.
3.9 The respondent submitted that
(a) assuming that persons aged less than 30 years were more likely to be adversely affected by the five-year service requirement, this did not constitute discrimination for the purposes of the 1998 Act by virtue of section 34 (7) of the Act;
(b) the abolition of the service requirement would significantly increase the costs of running a competition for promotion to Higher Executive Officer, of training of persons entering at that level without the requisite experience within the Civil Service, and potentially increase costs related to ill health, which entitled the respondent to place reliance on section 34 (3) of the 1998 Act;
(c) even assuming the exemptions did not apply, the respondent claimed it could objectively justify the service requirement for the purposes of section 31 (1) (d) of the Act as follows:
(i) the respondent was entitled to come to the conclusion that service as an Executive Officer was relevant for the acquisition of the experience to perform satisfactorily as a Higher Executive Officer;
(ii) recourse to a service criterion was necessary to promote industrial relations harmony;
(iii) increased costs in themselves meant that the five-year requirement was reasonable in all the circumstances of the case.
4. INVESTIGATION AND CONCLUSIONS OF THE EQUALITY
OFFICER
4.1 In reaching my conclusions in this case I have taken into account all of the submissions, both oral and written, made to me by the parties.
4.2 The complainant alleged that the respondent discriminated against him indirectly on the ground of age contrary to the provisions of the Employment Equality Act, 1998. Section 31, dealing with indirect discrimination, provides that
(1) Where a provision (whether in the nature of a requirement, practice or otherwise) relating to employment --
(a) applies to all the employees or prospective employees of a particular employer who include C and D or, as the case may be, to a particular class of those employees or prospective employees which includes C and D,
(b) operates to the disadvantage of C, as compared with D, in relation to any of the matters specified in paragraphs (a) to (e) of section 8(1),
(c) in practice can be complied with by a substantially smaller proportion of the employees or prospective employees having the same relevant characteristic as C when compared with the employees or prospective employees having the same relevant characteristic as D, and
(d) cannot be justified as being reasonable in all the circumstances of the case,
then, subject to subsections (4) and (5), for the purposes of this Act the employer shall be regarded as discriminating against C, contrary to section 8, on whichever of the discriminatory grounds gives rise to the relevant characteristics referred to in paragraph (c).
4.3 As the respondent accepted that statistics would demonstrate that a five-year service requirement could have the effect of indirectly discriminating against Executive Officers under the age of 30 years, there is no necessity for me to consider the complainant's arguments that indirect discrimination occurred. The respondent concentrated its submissions on whether it could avail of one of the exemptions under the 1998 Act, or alternatively whether it could objectively justify the service requirement. I will consider each of these arguments in turn.
Section 34 (7) exemption
4.4 The respondent argued that the five-year service criterion for promotion to Higher Executive Officer constituted a term or condition of employment in the context of section 34 (7), which provides
It shall not constitute discrimination on the age ground for an employer to provide for different persons -
(a) different rates of remuneration, or
(b) different terms and conditions of employment,
if the difference is based on their relative seniority (or length of service) in a particular post or employment.
4.5 I note that the Civil Service Regulation Act, 1956 provides at section 17 (1) that the Minister shall be responsible for
(c) the fixing of
(i) the terms and conditions of service of civil servants, and
(ii) the conditions governing the promotion of civil servants. Section 2 of the 1956 Act provides that [t]he Minister may, for the purposes of subsection (1) of this section, make such arrangements as he thinks fit and may cancel or vary those arrangements.
It is apparent, therefore, that the conditions governing promotions are excluded from terms and conditions of service of Civil Servants in the context of the 1956 Act. While that Act provides the Minister with the power to make, cancel and vary such arrangements, such power is only permissible under the 1998 Act if it does not result in discrimination on one of the grounds.
4.6 Section 8 of the 1998 Act provides that an employer may not discriminate in relation to conditions of employment (section 8 (1) (b)) or in relation to promotion or re-grading (section 8 (1) (d)). Section 8 (6) expands on the principle of nondiscrimination in conditions of employment by reference to terms of employment, working conditions and treatment in relation to overtime, shift work, short time, transfers, lay-offs, redundancies, dismissals and disciplinary measures. Section 8 (8) expands on the principle of non-discrimination in relation to promotion by reference to an employer refusing or deliberately omitting to offer or afford an employee access to opportunities for promotion, or not offering or affording access in the same way as to another person. It is clear to me that promotional opportunities are not encompassed within the definition of terms and conditions of employment in the context of the 1998 Act. I am satisfied therefore that the respondent cannot rely on the exemption in section 34 (7) to make its actions lawful in terms of the Act.
Section 34 (3) exemption
4.7 Section 34 (3) provides that
Nothing in this Part or Part II shall make unlawful discrimination on the age ground or the disability ground in circumstances where it is shown that there is clear actuarial or other evidence that significantly increased costs would result if the discrimination were not permitted in those circumstances. The respondent said that costs would increase in a number of ways if all Executive Officers were eligible to compete for interdepartmental Higher Executive Officer competitions. It provided an initial estimate that the cost of the competition itself would increase three-fold. As the competition held in 2001 had cost £110,000, this would result in future competitions costing in the region of £400 - 450,000. There would also be increased costs for individual departments, if the total Executive Officer cohort was eligible to apply for promotion, and presuming the deletion of the service requirement also applied to internal competitions. The respondent also suggested that promoting a candidate without adequate experience would result in the Assistant Principal having to monitor performance, instead of having an inexperienced Executive Officer monitored by a Higher Executive Officer. This would have particular impact in departments with significant clerical numbers, where a Higher Executive Officer would have staff management responsibilities.
4.8 As the respondent's estimated costs were based on the 2001 competition, I asked that it carry out an evaluation of the costs involved in the 2002 competition, when the eligibility requirement had been reduced to three years. This evaluation demonstrated that the 2001 competition, when 877 officers applied, cost €136,000. The 2002 competition, when 1033 officers applied, cost €121,580. The respondent pointed out that all 2002 costs had not been invoiced at the date the information was provided (7 May 2003). It argued that the pool of potential applicants in the 2002 competition had been smaller than might have been anticipated, given the reduction in the service requirements, because there had been a large increase in other promotional opportunities within departments. It said also that the 2002 tests were held on a weekday, resulting in reduced overtime costs, and the testing board had comprised serving civil servants who were not entitled to submit fee claims, unlike the board members used in 2001. Finally, the respondent said the testing process had been streamlined to a shorter process requiring just a half-day, rather than the full day required in 2001, resulting in cost reductions in printing and room hire.
4.9 Comparison of the costs of the two competitions was made difficult by the fact that different sub-heads were used on both occasions. Having examined the details provided and made every effort to compare like with like, I was unable to identify any particular outstanding cost. The amounts charged for each element of both competitions were broadly similar, except in relation to the overtime, printing and room hire savings identified by the respondent. No evidence was adduced that increased costs would occur at all, let alone the "significantly increased costs" envisaged by section 34 (3). I am unable to consider as relevant the respondent's assertions regarding cost increases connected with training and potential ill health. The exemption provided for by section 34 (3) is so drastic, insofar as it actually permits discrimination on the age and disability grounds, that very clear and specific evidence would be essential before I could determine that a respondent could invoke the exemption. I am satisfied therefore that the respondent cannot rely on the exemption in section 34 (3) to make its actions lawful in terms of the Act.
Objective justification
4.10 The respondent proposed three reasons why it could claim objective justification. Prior to considering each of these arguments, it may be useful to consider a recent Labour Court determination which dealt with this concept. In the case St James's Hospital and Dr Bennett Kim Heng Eng (EDA023), which was a claim of discrimination in pay on the race ground, the Court said "The solicitor for the respondent submitted that the standard of justification necessary to save an otherwise discriminatory term or criterion, under section 29 (4) (d), is lower than that of objective justification required by section 19 (4) (d), in a case involving discrimination on the gender ground. The Court accepts that by using different terminology in both sections the Oireachtas must have intended that a lower standard of justification would be required in cases of discrimination on the non-gender grounds than that derived from the jurisprudence of the ECJ in cases involving gender equality. Nonetheless, the standard of justification required cannot be so low as to render the section ineffective or nugatory...the dominant purpose of the factors relied upon must relate to an objective which the employer is required to pursue or is reasonably entitled to pursue and that they go no further than is reasonably necessary for the attainment of the objective." I am satisfied that the same standard applies to claims of objective justification based on the provisions of section 31(1).
Necessary experience
4.11 The respondent argued that a period of time was necessary to evaluate Executive Officers recruited by open competition to ensure they were suitable for promotion to Higher Executive Officer with regard to training, ability and health requirements. In support of this claim, the respondent referred to the ruling of the European Court of Justice in Danfoss. The respondent acknowledged that the fiveyear requirement had not been arrived at scientifically, but rather evolved by negotiation from an earlier seven-year requirement. It also acknowledged that the service requirement had been reduced to three years by the time of the 2002 competition, but said that successful candidates would be closely monitored after appointment to ensure they reached the required standard.
4.12 It became apparent at the hearing of this claim that the respondent did not in fact have any particular procedures in place to monitor successful candidates from the 2002 competition. The alteration in service requirement was agreed with the union, as was its predecessor, and successful candidates were appointed in an acting capacity for one year in the normal course and then made substantive if suitable. The respondent was unable to provide any objective evidence to support the service requirement. I am satisfied that the five-year service requirement does not have any particular connection with experience as envisaged in the Danfoss decision. It should be pointed out that Danfoss was a decision on gender discrimination, made at a time when European Union law had no provisions against age discrimination. It remains to be seen how the European Court of Justice would approach such an issue today, in the context of the provisions of the Framework Directive (Council Directive 2000/87/EC) prohibiting such discrimination.
4.13 I am reinforced in my view that there is no objective evidence in support of the service requirement by commitments to open recruitment for certain grades, as well as an agreed service requirement of two years for promotion to all grades, in Sustaining Progress - Social Partnership Agreement 2003-2005. As a consequence, the Civil Service Commission advertised an open competition for recruitment to the Higher Executive Officer grade in June 2003. Further consideration of objective justification in this regard is therefore unnecessary.
Industrial relations harmony
4.14 The respondent said that the Civil Service ethos was to ensure union approval for measures relating to grading, pay and promotion, where possible, and that the Civil Service unions favoured the application of service criteria in promotion competitions. This partnership approach in Civil Service employment meant that any attempt by the Minister to alter service requirements without union negotiation would have negative consequences for industrial relations harmony.
4.15 However, the 1998 Act makes it clear that union agreements may be unlawful if they contain discriminatory provisions. Section 9 of the Act, which applies to collective agreements and certain employment orders, provides that
(2) If an agreement...contains a provision...which gives rise to discrimination...then, subject to subsection (4), that provision shall be null and void...
(4) In the case of a provision which-
(a) is contained in an agreement...made before the coming into operation of this section, and
(b) is discriminatory on a ground other than the gender ground, ...subsection (2) shall not apply until the first anniversary of the date on which this section comes into operation.... I am therefore satisfied that, even if the five-year service requirement constituted a collective agreement as envisaged by the Act, it became null and void on 18 October 2000.
Increased cost
4.16 The respondent argued that, even if it could not establish that it could avail of the exemption provided for in section 34 (3) (see 4.7 above), the increased cost that would ensue as a result of the lack of service requirement could constitute an objective justification for the retention of the requirement. I have already said that I do not find the respondent can avail of the exemption, but I wish to deal with the question of cost in respect of objective justification.
4.17 The 1998 European Court of Justice decision in Hill and Stapleton v the Revenue Commissioners and Department of Finance (Case C-243/95) dealt with service credit given to job-sharers for incremental purposes. The Court found that giving lesser incremental credit to job-sharers was indirectly discriminatory against females because they were more likely to job-share for childcare purposes, and the Court further found that there was no objective justification for the practice. In the course of its decision, the Court remarked "So far as the justification based on economic grounds is concerned, it should be noted that an employer cannot justify discrimination arising from a job-sharing scheme solely on the ground that avoidance of such discrimination would involve increased costs." I am satisfied that the same principle arises in this claim. While an increase in costs may allow an employer to claim the exemption provided for in section 34 (3), it cannot in itself provide objective justification for a discriminatory practice.
Conclusion
4.18 It was accepted by the respondent that the five-year service requirement could give rise to indirect discrimination on the age ground against persons aged less than 30 years. The respondent argued that it could avail of the exemption provided for in section 34 (7), or the exemption provided for in section 34 (3). Alternatively, it argued that it could objectively justify the service requirement. I have found that the respondent cannot avail of either of the exemptions. I am also satisfied that the fiveyear service requirement cannot be justified as being reasonable in all the circumstances of the case, as would be necessary for it to be objectively justifiable in terms of section 31 (1) (d), taking into account the standard required.
4.19 The respondent had briefly referred to the fact that the complainant was unestablished at the time of the disputed competition, and would therefore be ineligible even in the absence of the service requirement. The Sustaining Progress commitment to open recruitment means that this criterion has become irrelevant and requires no further consideration. It seems to me to be possible to have a valid, objective service requirement for promotion, but since open recruitment to Higher Executive Officer has already begun, there is no need for me to make any order as to an alternative service requirement. I am satisfied that monetary compensation for the complainant is the appropriate redress.
5. DECISION
5.1 Based on the foregoing, I find that the Department of Finance discriminated indirectly against Mr McGarr on the ground of age, contrary to the provisions of section 31 of the Employment Equality Act, 1998, when he was unable to compete for promotion to Higher Executive Officer because of a five-year service requirement. I hereby order that the Department of Finance pay the complainant a sum of €1500 in compensation for the effects of the discrimination suffered by him.
_____________________
Anne-Marie Lynch
Equality Officer
3 September 20