The Complainant’s employment was terminated on 14th June 2019. He is claiming that he was discriminated against by reason of his age in terminating his employment. The Complainant was due to turn 65 years on 17th June 2017. He had a meeting with HR regarding retirement and he requested to remain on in their employment. On 19th June 2017 he received a written contract for that year from his retirement date. The following year he requested to continue in employment for another year. This was agreed and he received a written contract for that year. On 18th April 2019 he was advised by e-mail by the CEO that the company would not be extending his employment further and that his employment would end on 17th June 2019. He was offered some staff training jobs on a consultancy basis. This was not acceptable, so his employment terminated on 17th June 2019.

The Complainant stated that he was discriminated on the grounds of age in circumstances where his employment was terminated. This claim is disputed by the Respondent. In order to succeed in a claim for discriminatory dismissal in these circumstances, the Complainant’s claim must meet two tests: (i) there is no mandatory retirement age in the business; and (ii) the retirement age is not justified by reference to any legitimate aim.

Mandatory Retirement Age

The Respondent has in place a mandatory retirement age of 65. The Complainant was aware of the mandatory retirement age and there can be absolutely no dispute in relation to this in the following circumstances: A Retirement Clause is included in the Transferor ‘s Employee Handbook at page 22 which states “The normal age for retirement is 65, and it is our policy for employees to retire at the end of the week in which their 65th birthday falls”. A Retirement Clause is included in the Transferee Employee Handbook (which is identical to the clause in the Transferor Handbook) at page 18 which states, “The normal age for retirement is 65, and it is our policy for employees to retire at the end of the week in which their 65th birthday falls”. The Complainant made a request to work beyond the mandatory retirement age in 2017 and again in 2018. It appears that the existence of a mandatory retirement age is not disputed by the Complainant, rather, the claim appears to be that the mandatory retirement age was not objectively justified. In the event that this is disputed by the Complainant.

Objective Justification

Council Directive 2000/78/EC established a general framework for equal treatment in employment and occupation. The Directive recognises that differences in treatment in

connection with age may be justified by member states under certain circumstances.

Accordingly, Article 6(1) of the Directive provides that discriminatory treatment directly

based on age is permissible subject to objective and reasonable justification and where

the means of achieving these aims are appropriate and necessary. Mandatory retirement is not prohibited in Ireland and it is specifically provided for in the Employment Equality Acts. Section 34(4) of the Employment Equality Acts states:- “ 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 if a) it is objectively and reasonably justified by a legitimate aim, and b) the means of achieving that aim are appropriate and necessary”.

It is not in breach of the legislation to retire an employee on reaching 65 years where the above test is satisfied. There are numerous decisions from both the Court of Justice of the European Union (CJEU) and the Labour Court upholding mandatory retirement where retirement is objectively justified. In this case, the Respondent referred specifically to the following objective aims in its letter to the Complainant dated 28 May 2019:-

a. Health and Safety of staff

The CJEU and the Labour Court have accepted that people’s physical capacity deteriorates as they age and that setting a retirement age is an objective and legitimate means of protecting the safety of staff. Of a workforce of 380, approximately 300 employees (shop staff roles) hold roles which are physically demanding. While, at the date of dismissal, the Complainant’s role is not a health and safety critical or physical role, other roles with the Respondent organisation are physically demanding and/or safety critical. However, the Respondent is entitled to elect one mandatory retirement for all staff rather than setting different retirement ages within the business. The need

to have cohesion in the workplace by having the same retirement age for all employees has been accepted by the Equality Tribunal in the case of: Paul Doyle -v- ESB International (DEC-E2012-086):

“While I do note that such ‘genuine occupational requirement’ does not apply to the complainant whose occupation was that of a graphic designer, I do find that legitimate employment policy means that a respondent is entitled to maintain a retirement age that ensures cohesion among all of its employees. Having different rules of retirement for different employees may threaten the cohesion and open up other areas of discrimination that may not be subject to an objective justification test.”

b. Preservation of Personal and Professional Dignity

The CJEU and the Labour Court have accepted in numerous cases that a retirement age in an organisation assists prevents disputes on whether or not a person is fit to perform the work. The setting of a retirement age in the Respondent organisation is essential to prevent disputes regarding performance. The CJEU reaffirmed this position in the case of Rosenbladt v Oellerking

Gebaudereiniqungsqes mbh, C-45/09 where the Court found that the automatic termination of employment contracts also has the advantage of not requiring employers to dismiss employees on the ground that they are no longer capable of working, which may be humiliating for those who have reached an advanced age. This point was also accepted in the case of Hornfeldt v Posten Meddelande, 0/2012/421l where the CJEU held in favour of the Swedish Government's aim of avoiding terminations of contracts “in circumstances humiliating to older workers".

In Ireland, the Labour Court in the case of Irish Ferries Limited v Martin McDermott EDA1631 found that setting a retirement age was a legitimate means of preserving the dignity of the older workforce: “The setting of a maximum working age of 65 at this time ensures that staff are not

exposed to the embarrassment of finding themselves incapable of discharging their duties and being retired in that contact rather than with dignity and respect.”

c. Succession Planning

Having a retirement age facilitates workforce planning. The Respondent needs to be able to plan when staff are retiring in order to plan for recruitment of a replacement. This is particularly important for roles in the Respondent’s head office and management roles. Of the overall staff headcount of 380, only 20% of the workforce are at manager level with responsibility for Health & Safety, Cash & Stock assets and Staff. Proper planning therefore around succession is critical for the operation of the business.

d. Providing Promotional Opportunities

With unemployment currently standing at 5.2%, retailers are finding it increasingly difficult to retain and recruit staff. The difficulty in recruiting and retaining staff in the company is evident from its high staff turnover figures: Staff Turnover Figures 2018 - Starters 294; Leavers 222

Turnover Figures 2019 Year to date Starters 167; Leavers 188. The Respondent has in place the following strategies for ensuring that it recruits and retains staff:

a) Providing promotional opportunities through mandatory retirement

One way of attracting staff is to ensure that staff see a pathway to progression

particularly to the head office (which is small with approximately 16 staff of an overall

workforce of 380). Staff retention by offering promotional opportunities is therefore a

crucial consideration for the viability of the business. Unfortunately, due to the flat

structure in the organisation (with a narrow or funnelling affect at the top), promotional

opportunities are rare and it is vital therefore that staff are retired in the business to

allow promotional opportunities.

b) Training

Due to the difficulties in recruiting and retaining staff in the retail sector, the representative body for the entire retail industry in Ireland, has developed the first Retail Skillnet to develop career paths to attract new entrants. Within the Respondent, they invest in retaining the workforce by investing in training and development. The training provided follows the 70/20/10 model. 10% structured learning, 20% instruction and support from internal trainers and 70% on the job training. The 20% instruction training is directed at key staff willing to take on new

opportunities and “journey through” the business. It is specifically aimed at developing

staff with a view to promotion. Failure to hold on to its most valuable resource (staff) would deprive the business of a valuable skillset and the loss of money spent on training and learning and development.

c) Internal Recruitment and Promotions

In order to retain staff, in addition to having a mandatory retirement age, the Respondent also has a policy of advertising vacant roles internally.

In the case of Donnellan v The Minister for Justice, EquaIity and Law Reform. [20081 IEHC 467], the High Court dismissed the claim of Assistant Commissioner Donnellan that the retirement age of 60 for his rank was discriminatory. In this case, the State was successful in arguing that a retirement age was necessary to ensure that talented young people could move through the Garda ranks and that to restore the retirement age to 65 would create a blockage at senior level. In the case of Paul Doyle -v- ESB International (DEC-E2012-086), the WRC found that: “Furthermore, I am satisfied that the respondent spends extensive resources and time in training its new employees. I am satisfied that in order to achieve this aim the respondent must ensure that it can offer career pathways to such employees and ensure vacancies for upward post become available. This is a necessity to ensure retention, motivation and dynamism among the respondent staff. I am satisfied that the respondent wishes to establish an age structure among its younger and older

employees in order to encourage the recruitment and promotion of young people and to facilitate good personnel management. I am therefore satisfied that the respondent has an established a legitimate employment policy with a legitimate aim for the reason why, at the latest, employees with the respondent must retire at 65 years of age.”

e. Inter-Generational Fairness

The Courts have consistently held that considerations of longer working need to be balanced against ensuring adequate employment opportunities for young adults (an equitable distribution to employment opportunities between generations) and preserving pathways for career advancement and progression and that ensuring intergenerational fairness constitutes a legitimate aim justifying a retirement age. In the case of Judy Bamford v Citizens Information Phone Services Limited ASJ- 00017442, the WRC found that setting a retirement age of 65 was an approximate means of ensuring intergenerational fairness and promotional opportunities.

It is further submitted that the adjudicator need only be satisfied that one of the above reasons amount to a legitimate aim. In the case of Donnellan v The Minister for Justice, EquaIity and Law Reform. [20081 IEHC 467], the High Court stated that: “Before continuing, I would note that it is firmly established that where justification is sought, and multiple reasons are given, it will be enough that one or more of the justifications advanced, amount to a legitimate aim.”

It is further submitted that by virtue of section 6(3)(c) of the Employment Equality Act 1998 (as amended): “Offering a fixed term contract to a person over the compulsory retirement age for that

employment or to a particular class or description of employees in that employment shall not be taken as constituting discrimination on the age ground if: (i) it is objectively and reasonably justified by a legitimate aim, and (ii) the means of achieving that aim are appropriate and necessary.” The Respondent submits that in circumstances where the Complainant requested to

work following his retirement age, presumably in order to stay in employment until such time as he could draw down the state pension, and in circumstances where his knowledge of the Respondent’s business (corporate memory spanning over 30 years) was necessary prior to and during the sale of the business, particularly the due diligence exercise, the use of a fixed term contract/extension was appropriate and necessary means of allowing the Complainant to work for a period beyond his retirement age through the sales process. Furthermore, again, the legitimate aims set out in paragraph 29 were also relevant to the decision to offer a fixed term

contract/extension. The offering of a fixed term contract/extension was an objective and

reasonably justified means of ensuring that succession planning, inter-generational fairness and the dignity of older workers was achieved, amongst the other legitimate aims. Offering a permanent contract would have entirely undermined these aims. In the case of Judy Bamford v Citizens Information Phone Services Limited ASJ-00017442, the WRC found that using a fixed term contract following the retirement of an employee was an appropriate means of ensuring intergenerational fairness and promotional opportunities. The Respondent also offered to consider retaining the Complainant as a PSA consultant following the termination of his contract in 2019. This is evidence that age was not the reason for the termination of employment. Rather, the reason was to ensure succession planning, inter-generational fairness and the dignity of older workers amongst the other legitimate aims.

The Complainant anticipates that an argument will be made by the Respondent that the

provisions of the Unfair Dismissals Act 1977 (as amended) do not apply in accordance with section 2(2)(b). No such argument is made by the Respondent. The argument is entirely irrelevant as the claim has been brought under Employment Equality legislation and not Unfair Dismissal legislation.

In conclusion the burden of proof rests with the Complainant to show that he was discriminated against on grounds of age. Should the Complainant shift this burden, it is the position of the Respondent that the claimant was retired in line with its normal retirement age which was lawful within the provisions of the Employment Equality Act.

They also stated that reinstatement or re-engagement was not an option. If any award was contemplated by the Adjudication Officer, it should not be punitive. The Complainant has not sought employment since, the Respondent acted reasonably and he was offered a consultancy role.

I find that Section 85A of the Employment Equality Acts 1998 – 2011 sets out the burden of proof which applies to claims of discrimination. It provides, in effect, that where facts are established by or on behalf of a complainant from which discrimination may be inferred, it shall be for the respondent to prove the absence of discrimination. The test for applying that provision is well settled in a line of decisions of the Equality Tribunal and the Labour Court and it requires the complainant to prove the primary facts upon which he relies in seeking to raise an inference of discrimination.

It is only if this initial burden is discharged and the Adjudication Officer is satisfied that the facts as established are of sufficient significance to raise a presumption of discrimination, that the burden of proving that there was no infringement of the principle of equal treatment passes to the respondent. If the complainant does not discharge the initial probative burden required, his case cannot succeed.  

I find that the Complainant has established an inference of discrimination to such an extent that the burden switches to the Respondent to prove that no discrimination has taken place.

I will address the arguments that the Respondent made in their endeavours to prove that discrimination did not take place.

Mandatory retirement age

I find that mandatory retirement ages are not unlawful under Irish law. However, employers must be able to objectively justify their decision to impose a mandatory retirement age.

I find that there must be compelling evidence that the use of the mandatory retirement age is appropriate, proportionate and a necessary means of achieving a legitimate aim.

I find in this case the use of mandatory retirement age is not in dispute. It is contained in the Staff Handbook which formed part of his terms and conditions of employment.

I also find that he requested to work beyond the mandatory retirement age. So, the matter then turns to whether it was objectively justified or not.

I find that for it to be objectively justified there must be compelling evidence that the use of the mandatory retirement age is appropriate, proportionate and a necessary means of achieving a legitimate aim.

I note that the Respondent wrote to the Complainant on 28th May 2019 stating “Unfortunately retirement is not a decision about you, or anyone else for personal reasons, rather it is a decision taken to protect the health and safety of staff to preserve personal and professional loyalty and also to assist with succession planning providing promotion opportunities and intergenerational fairness”.

I have examined those matters below:-

Intergenerational fairness

I find that intergenerational fairness applies where it is used to allow younger employees to progress to more senior roles and to attract new talent into an organisation. It can be argued that if older people are permitted to stay at work after the age of 65, many remain in senior roles and this prevents younger people from progressing and new joiners from joining.

I find that this argument was not clearly set out by the Respondent at the time of the termination of employment and no evidence was adduced by the Respondent to support such a position.

Health and Safety of staff

I note that the Respondent argued that CJEU and the Labour Court have accepted that people’s physical capacity deteriorates as they age and that setting a retirement age is an objective and legitimate means of protecting the safety of staff.

I find that this argument was not clearly set out by the Respondent at the time of the termination of employment.

I find that there was no suggestion that the Complainant’s health was an impediment to him continuing in employment. In fact, the Respondent was willing to offer him work on a contractual basis.

Internal recruitment and promotion opportunities

While it can be argued that a mandatory retirement age can assist with internal recruitment and promotion opportunities, I note that it was not addressed at his retirement date and explained why it applied then and not to the two previous years when his contract was extended.

Succession planning

Succession planning is a critical business objective; however, I find that this argument was not clearly advanced by the Respondent at the time of the termination of employment and why it applied then and not at the two previous extensions to his contract of employment.

Preservation of personal and professional dignity

I note that the Respondent referred to the CJEU and the Labour Court having accepted in numerous cases that a retirement age in an organisation assists and prevents disputes on whether or not a person is fit to perform the work. They stated that the setting of a retirement age in their organisation is essential to prevent disputes regarding performance.

I find that this may very well be a legitimate objective of any organisation however I found no evidence that this was raised by the Respondent with the Complainant at the time of his retirement and there was no inference whatsoever that the Complainant was not capable of performing his duties. There was no suggestion put forward that he had been capable of performing his duties at the time of the two previous extensions to this contract of employment but not at the time when his employment was terminated.

I find that the Respondent should consider the impact on the employee both financially and otherwise and the impact on the organisation must be balanced and weighed up when determining the proportionality of using a mandatory retirement age.

In this case I find that the Respondent had no such concerns when extending the contract of employment on two occasions and then listed the above matters as a reason for not extending the contract on a third occasion, without setting out clearly why it was relying upon these issues.

Therefore, I must conclude that the Complainant was discriminated against on grounds of age.