ADJUDICATION OFFICER DECISION

Adjudication Reference:

ADJUDICATION OFFICER DECISION

Adjudication Reference: ADJ-00024869

Parties:

	Complainant	Respondent
Parties	Claire O'Dowd	Franciscan Province of Ireland

	Complainant	Respondent
Anonymised Parties	An Accounts Office Worker	A Religious Congregation

Representatives

Peter McInnes of McInnes Dunne Solicitors

Graham Bailey of IBEC

Complaint(s):

Act	Complaint/Dispute Reference No.	Date of Receipt
Complaint seeking adjudication by the Workplace Relations Commission under section 77 of the Employment Equality Act, 1998	CA-00031477-001	08/10/2019

Date of Adjudication Hearing: 18/12/2019

Workplace Relations Commission Adjudication Officer: Michael McEntee

Procedure:

1: General

In accordance with Section 79 of the Employment Equality Acts, 1998 - 2015, following the referral of the complaint(s)/dispute(s) to me by the Director General, I inquired into the complaint(s)/dispute(s) and gave the parties an opportunity to be heard by me and to present to me any evidence relevant to the complaint(s)/dispute(s).

The Claim under the Employment Equality Act,1998 specified Discrimination on the grounds of Age, Conditions of Employment, Discriminatory Dismissal and Dismissal because Discrimination was Opposed.

Regarding the four Discriminatory grounds advanced I am considering them as one Complaint as the evidence advanced covered all as one unit and differentiation would not be practical.

2: Anonymity

It was agreed that the names of the Parties could be mentioned in any WRC Published materials.

3: The Burden of Proof

The Equality Act 2004 inserts a new section, 85A, into the Employment Equality Acts 1998 – 2015.

“85A – (1) Where in any proceedings, facts are established by or on behalf of a Complainant, from which it may be presumed that there has been discrimination in relation to him or her, it is for the Respondent to prove the contrary.”

The effect of this is to place the burden of proof in the first instance on a Complainant, to establish facts which, on an initial examination lead to a presumption that discrimination has occurred. Referred to as “prima facie” evidence, the onus is on the Complainant to show that, based on the primary facts, she has been treated less favourably than someone who has not reached the age of 65. The primary facts are not in dispute: the Complainant was retired at age 65 and she wanted to remain at work. At the opening of the hearing, the parties agreed that, based on these facts, the Complainant has discharged the burden of proof which leads to a presumption that discrimination has occurred. Having established these facts, the burden of proof now shifts to the Respondent to show that discrimination has not occurred.

Background:

The issues in contention concern the alleged Discrimination on Age Grounds by the Employer, a Religious Foundation, against the Employee, an Office Worker, specifically the requirement to retire on her 65 birthday and an alleged Discriminatory refusal to allow her to continue working post her 65th birthday.

1: Summary of Complainant’s Case: Adjudicator precis of Written and Oral Evidence

The Complainant commenced employment with the Respondent on a 20 Hour a week basis in Sept 2009. She was effectively, compulsorily, retired on the 5th July 2019. Her application to work after her 65 birthday was rejected. The Respondent’s letter of the 5th June 2019, setting out reasons for refusal, was cited in evidence.

After her exit, a HR Consultant was engaged to review the decision. The Consultant investigated the issues involved in July 2019 and issued a Report shortly afterwards. The Report did not find in the Complainant’s favour.

It was submitted in comprehensive evidence from the Complainant that the Report was seriously flawed in many aspects, both legally and procedurally, and could not be relied upon by the Respondent to support their decision.

In detailed Legal evidence, covering both Irish and European law, the Complainant pointed to the growing body of Legal precedent that any Retirement Age needed to be Objectively justified and satisfactory of Achieving a Legitimate aim. Extensive case law was cited in evidence.

It was the Complainants case that firstly, No Proper Objective justification process had taken place regarding the decision to require the Complainant to stop working at age 65 and secondly, that there was No proper or justifiable Legitimate Aim being advanced to support the decision. Articles 4 & 6 of the “Framework Directive” Directive 2000/78/EC were cited. Article 6 provides for a two-legged test for determining whether age discrimination is justifiable; firstly, is it objectively and reasonably justified by a legitimate aim; and secondly, are the means of achieving that aim appropriate and necessary.

The Complainant pointed to the cases of Georgiev and Technicheski universitet Sofia, [2010] ECR, C-250/09 and Seldon v Clarkson Wright & Jakes [2012] IRLR 591 of the UK Supreme Court in relation to the need for clarity and precision in any Aims and or Means being employed to achieve these. The landmark Irish Donnellan case, Donnellan v Minister for Justice, Equality and Law Reform [2008] IEHC 467 was also referenced in the same context.

The Code of Practice on Longer Working (SI 600/2017) was also cited in support of the Complainant’s case. It was maintained that the Code had not been observed by the Respondent.

In addition, it was also clear from other supporting references and direct evidence that the Retirement Age policy of the Respondent was characterised by inconsistencies and in the final analysis come down to the individual personal Decisions of Respondent Managers.

Section 34 (4) colloquially “the Retirement exemption” of the Employment Equality Act cannot be relied upon and that the actions of the Respondent were without any doubt Discriminatory in clear breach of Section 8 of the Employment Equality Act,1998.

As stated above extensive Legal arguments, covering both EUCJ and Irish/UK Superior Court decisions, were made in support of the Complainant’s case.

Witness evidence was given by the Complainant personally and was subject to questioning by the Respondent.

2: Summary of Respondent’s Case: Adjudicator precis of Written and Oral Evidence

The basic Employment dates are agreed. In a meeting of the 8th February 2019 the Complainant was informed that her retirement was due to take place on the 5th July 2019, her 65th birthday. Following the 8th February meeting the Complainant requested an opportunity to work beyond her 65 birthday -the retirement age. This was declined by the Respondent who explained that Retirement at age 65 was now a “Respondent Wide Policy” to sustain employment opportunities in the local Communities served and to ensure Intergenerational fairness throughout the Organisation. The issue was appealed by the Complainant and a meeting between the parties took place on the 31st May 2019 to discuss further.

A comprehensive letter was issued by the Respondent on the 5th June 2019. The letter stated that the Retirement age of 65 was based on a review of all the roles in the Organisation, their physical demands etc, the need to have a balanced age structure in the Organisation, and the need to create employment opportunities in the local Communities served by the Organisation. There was a Pension Scheme set up to provide a financial provision for staff retiring at age 65. In addition to this latter point, the Respondent felt that the Social Justice ethos of the Organisation would be compromised by allowing a person eligible for a Pension to remain working while the need for local job opportunities remained in the Communities served. The Age 65 Retirement age was also in the Employee’s Contract of Employment/Handbook and all pension documentation.

This letter, of the 5th June, was not accepted and following discussion it was agreed to have an Independent Outside Consultant – (Shane Twomey -Organisational Dynamics) effectively hear an Appeal against the Respondent decision.

The Independent Appeal Chairperson did not support the Appeal stating that

“The submission specifically accepts that the appeal is not about the presence of the Retirement age but is about longer working. As there is no entitlement or right to longer working, as Ms X was aware the retirement age was set at 65, as the policy has been consistently applied and as there were no specific grounds to allow longer working in this case, I do not allow the appeal.”

The matter was then referred to the WRC by the Complainant. As in the Complainant case above, extensive Legal arguments, covering both EUCJ and Irish/UK Superior Court decisions, were made in support of the Respondent.

Witness evidence was given by the HR Manager, Ms. Xa, supported by overall Manger Mr. Xb, and was subject to questioning by the Complainant’s Representative.

3: Findings and Conclusions:

3:1 The basic Law

The legal framework prohibiting discrimination based on age is set out at section 6(1) of the Employment Equality Act 1998 – 2015 (“the Act”).

“…discrimination shall be taken to occur where –

(a) a person is treated less favourably than another person is, has been or would be treated in a comparable situation on any of the grounds specified in sub-section (2), in this Act, referred to as the ‘discriminatory grounds’…”

At sub-section 6(2)(f), “the age ground” is listed as one of the nine discriminatory grounds.

Section 34(4) was inserted into the Act by the Equality (Miscellaneous Provisions) Act 2015 as a qualifying provision permitting different treatment based on age. The objective of this insertion was to support the establishment of a general framework for equal treatment in employment and occupation, set out in Council Directive 2000/78/EC. Article 6 of the directive provides that,

“Member States may provide that differences of treatment on grounds of age shall not constitute discrimination, if, within the context of national law, they are objectively and reasonably justified by a legitimate aim, including legitimate employment policy, labour market and vocational training objectives, and if the means of achieving that aim are appropriate and necessary.”

Reflecting this wording, section 34(4) of the Act provides 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 if -

(a) it is objectively and reasonably justified by a legitimate aim, and

(b) the means of achieving that aim are appropriate and necessary.”

From the perspective of the associated legal provisions related to this case, the Code of Practice on Longer Working (SI 600/2017) provides guidance for employers and employees in the context of a desire on the part of some older workers who would like to remain in employment beyond the traditional retirement age of 65 years.

While the provisions of the Code are not legally binding, its guidance is set in the context of demographic, social and regulatory changes in Irish society:

§ Improvements in health and lifestyle means that we are living longer and therefore, living a greater proportion of our lives as non-working older people;

§ It is desirable to consider how our workplaces can encourage the retention of older people who want to work beyond the age of 65;

§ Since 2014, the State pension age is 66 and it will increase to 67 in 2021 and 68 in 2028;

§ There is no mandatory retirement age in the private sector and the Public Service Superannuation (Age of Retirement) Act 2018 provides that, subject to some exceptions, public service employees recruited after April 2004 will have a mandatory retirement age of 70.

Against this background, the Code recommends ways in which older workers can be supported to make a valuable contribution at work, while acknowledging that compulsory retirement at a specified age will not constitute discrimination if it can be objectively justified by a legitimate aim, including the aim of intergenerational fairness.

Regarding the extensive legal precedents advanced by both sides in evidence I am mindful that a First instance Adjudication, such as this is, must refer primarily to the basic facts and specific evidence of the case as the basis of an Adjudication under Irish Legislation -namely the Employment Equality Acts, 1998 - 2015.

3:2 Consideration of the Evidence presented.

In reviewing the Evidence, both Oral and Written, I felt that two issues had come to the fore, firstly the basic Principle of a Retirement Age at 65 Years and secondly the question of the Treatment of the Complainant in her Request to Work post 65 years.

I will take Section 34(4) of the Equality (Miscellaneous Provisions) Act 2015 as my touch stone.

(a) it is objectively and reasonably justified by a legitimate aim, and

(b) the means of achieving that aim are appropriate and necessary.”

3:2:1 Reasonable Justification and Appropriate Aims – The Age 65 Retirement Age

The essential Justification – the Aims -put forward by the Respondent employer in both Written and Oral evidence was that the age 65 Retirement Policy was designed to ensure Intergenerational Fairness within the Organisation and to ensure that employment opportunities were opened to the Communities served by the Respondent. This latter point was a major consideration derived from the Social policy issues of the Respondent, a major Religious and Charitable Organisation.

An Occupational Pension was provided payable at Age 65 years.

After careful consideration, the Aims of a Retirement at Age 65 Employment Policy and the accompanying Pension Scheme is in my view a Reasonable and Objectively justified Scheme. The Means of Achieving the aims of the Scheme by having an Age 65 Retirement Age in the Contracts of Employment must be looked at in tandem.

In the Donnellan v Minister for Justice, Equality and Law Reform [2008] IEHC 467 the Retirement Age of, in that case of 60 years, was not ruled out, once , as quoted by Justice McKechnie , the requirements of Legitimate Aims and Appropriate Means were satisfied.

The focus must then move to the Means employed. Here the views of the UK Supreme Court, Lady Hale and Lord Hope in Seldon v Clarkson Wright & Jakes [2012] IRLR 591 of the UK Supreme Court caution employers regarding having a flawed dynamic between Legitimate Employment Policies and “purely individual reasons which are particular to the situation of the employer.”. The means employed must be “appropriate and necessary to achieve the aim”.

In plain English I take this to mean that a Good and Appropriate Aim must be supported by an equally good and proportionate Means. This view was also stated by Justice McKechnie in Donnellan quoted above.

In the case in hand the Organisation had an age 65 Retirement scheme and, as quoted in evidence, had applied since 2017, a standard Retirement age.

On careful consideration the Organisation’s Pension/Retirement Policy at age 65 is a Reasonable & Legitimate Aim and the Means employed as set out in their Employment Policies are legitimate and proportional. Retirement is widely communicated to be at age 65, it is in employment Contacts & a variety of supporting Pension Documentation. It has the provision of Post 65 Working if appropriately and objectively justified. Clause 6 of the Contract of Employment refers.

Overall the Respondent Scheme is common with thousands of similar Schemes throughout Ireland.

It benefits, in my opinion, from the provisions of Section 34(4) of the Equality (Miscellaneous Provisions) Act 2015 2015 Act and is not Discriminatory.

Examination must now go to the second question raised above at 3:2 – the Post 65 Working issue.

3:2:2 The question of the Post 65 Work application of the Complainant. Objective Assessment

Since the Irish State moved the age of eligibility for Old Age Pensions upwards from Age 65 to 66 in 2014 and 67 in 2021 an effective “Gap” has been created for employees benefiting from Age 65 Occupational Pensions Schemes. Almost all of these Schemes have an inbuilt assumption that the Retiree will automatically benefit from the State Pension contemporaneously with the Occupational Pension Scheme Benefit immediately post 65 years of age.

The issue has been de facto addressed by allowing post age 65 Persons claim Unemployment Benefit for the Gap period. In this case the Complainant was availing of this option.

The facts of the case were that the Age 65 retirement Age was clearly part of the Employment Contract and had been signed for by the Complainant. The Respondent maintained that it had been applied consistently across the Organisation since a Management Board discussion on this issue in 2017.

The consistency Argument was challenged by the Complainant who cited examples of other employees who had been allowed work on post 65 years.

The Contract of Employment at Clause 6.7 is worth examining and I quote below.

6.7 Working Past NRD

Some employees may decide that they wish to work beyond their retirement age of 65 years. Should you wish to do this, it should be discussed with your Manager 12 months before your expected retirement date. It should be noted that this would be the exception rather than the norm, and as a maximum should be for no more than 2 years.

The decision about whether to extend an individual’s contract will depend on a number of factors including, but not limited to:

¾ The nature of the job being done

¾ The Individual’s ability to do the job (a medical may be required but as a minimum a medical fitness form will have to be completed and sent to the insurers)

¾ The number of hours work that are proposed

¾ The costs associated with remaining in employment e.g. insurance.

In the case in hand the oral and written evidence of the Respondent was that Clause 6.7 has been considered Objectively as would be required by Section 34(4) of the 2015 Act.

The Oral evidence from the Complainant was that she felt Discriminated as against other colleagues who had been allowed work post 65. In evidence it was established that two of these were Church cleaners who had worked on for a few months in a City Centre facility and some others were employees who were engaged in Facilities that were due to close in a few months. To let them go and then replace for a closing down Facility would have made no sense. It was unclear as to the exact retirement status of a Cook in a South Dublin house.

The bottom line from the evidence was that the Complainant was an Accounts Administrator with an excellent track record but who had no strong or specific reason to wish to remain working other than to close the State Pension Gap. The Pension on offer would be approximately 37% of the Complainant’s salary and would leave a substantial Income shortfall until contributory Old Age pension of approximately €12,911 would be applied at age 66 for the Complainant. At this stage her combined income would be in excess of €21,600 and close to her final salary income of €23,500.

Therefore, the key question for this Adjudication decision is a determination as to whether or not refusing to allow the Complainant work on Post 65 was Age Discriminatory?

The Complainant’s Legal Advisor was strongly of the view that an alleged failure on the Part of the Respondent Organisation to carry out “a full objective assessment” for Post 65 Working and following Section 34(4) was procedurally fatal to their case as well as not having proper and legitimate “Aims”.

The CJEU thoughts, in this area, were quoted usefully by the Complainants’ Legal representative in his submission. Proportionality /appropriateness can be judged by

¾ The availability of a Pension on retirement

¾ The concurrence of a State Pension with the Retirement age chosen

¾ Agreement among the Parties

¾ Consistency and Coherence of Application across the workforce

¾ Flexibility in Operation.

The State Pension issue has been considered above – the Gap problem. The Consistency issue was not absolutely clear but the Respondent HR Manager, Ms Xa, gave oral evidence of a new, since 2017, policy of Consistency. The question of flexibility was briefly discussed – the Organisation was small and realistically, it could be argued, nothing much would have come of allowing a derogation in favour of one extra year for the Complainant. However, the HR Manager was firm in her view that Retirement at Age 65 had to mean that - otherwise every age 65 situation across the Country would be problematic and would require a very detailed examination.

In weighing these arguments, I was conscious of the fact that a very comprehensive Independent Investigation had taken place by (Shane Twomey -Organisational Dynamics) with detailed evidence cited. The Complainant was of the view that the Consultant had not given proper opportunity to the Complainant’s side to respond to any evidence presented by the Respondent. However, from reading the e-mail traffic I came to the view that the Consultant had gone out of his way to achieve a balanced Report.

The Consultant, following a detailed review, did not find in the Complainant’s favour specifically on the Post Age 65 Working complaint.

Although an Independent Review could not strictly be called an objective assessment by the Respondent directly, I felt that it satisfied the Section 34 (4) requirement for an Objective Review of the Complainant’s situation.

3:2:3 Code of Practice on Longer Working (SI 600/2017

For further assistance I looked again to the Code of Practice on Longer Working (SI 600/2017) which provides guidance for employers and employees in the context of a desire on the part of some older workers who would like to remain in employment beyond the traditional retirement age of 65 years.

As stated above the provisions of the Code are not legally binding and its guidance is set in the context of demographic, social and regulatory changes in Irish society:

The Code of Practice on Longer Working, in addition sets out “best principles and practice to follow during the engagement of employers and employees in the run up to retirement.” The Code identifies examples of what constitutes a legitimate aim by an employer:

§ “Intergenerational fairness (allowing younger workers to progress);

§ Motivation and dynamism through the increased prospect of promotion;

§ Health and safety (generally in more critical occupations);

§ Creation of a balanced age structure in the workforce;

§ Personal and professional dignity (avoiding capability issues with older employees);

§ Succession planning.”

The Objective justification offered by the Respondent here included most of these and a further item - the Social Mission of the Organisation. To have a person on the payroll working who was eligible, at the same time for a Pension Payment from the Organisation and had the alternative of the Social Welfare payments for the post 65 year was considered contrary to the Social Mission of the Organisation. In the context of the Religious Organisation involved this was not an insignificant factor.

Finally, with the Code above in mind, in this case, I have to return again to the question, was it Age discriminatory not to offer extended working.?

As an aid, I note the final remarks of Mr Justice McKechnie in the landmark Donnellan case, Donnellan v Minister for Justice, Equality and Law Reform [2008] IEHC 467

where he stated,

“Any discrimination with regards to age must, as put by that Directive (2000/78/EC) serve a legitimate aim or purpose, and the means taken to achieve that purpose must be appropriate and go no further than is necessary, i.e. they should be proportionate.”

As an aside Mr Justice McKechnie found that the age 60 Retirement age in the Donnellan case was appropriate and reasonable.

The key question posed by this element of the case is at a fundamental level Societal. The Irish State has raised the Old Age State Pension Age to 66 years - creating the Income Gap for employees on Age 65 Pension Schemes. It has been approximately bridged by an effectively Ad Hoc Social Welfare provision which can apply to the Complainant. It involves the Complainant effectively “Signing on” for a year – an almost bogus situation that many find distasteful.

The Income Gap does not create a Legal Obligation on an Employer to offer extended working for the period and it does not follow that such a refusal is automatically Age Discriminatory per say once the normal issues of Objective Assessment and Legitimate Aims have been looked at properly.

To refuse Post 65 working, in this case, where it conflicted with the legitimate aims of intergenerational fairness, the Social Policy of the Organisation and had been the subject of a detailed Objective examination in the Shane Twomey Independent review could not be seen as a Disproportionate action. I did not think it was Discriminatory under Section 6 of the Employment Equality Act,1998.

In this case, as stated above and having reviewed all the evidence, I did not find that the refusal of Post 65 work was Age Discriminatory.

3:3 Final Summary

Having reviewed and considered all the evidence and the extensive Legal precedents quoted and returned to Section 34(4) of the 2015 Equality Act I came to the view that

The Age 65 Pension Scheme in the Organisation was entitled to benefit from the exemptions in Section 34 of the 2015 Act- therefore it was not deemed discriminatory.

The refusal to allow post age 65 working to the Complainant was not discriminatory seeing that it had been carefully and objectively considered both separately and as part of the Independent Review and was contrary to the stated Aims of the Organisation especially the Social Policy aim which were, in my view, Legitimate aims as required by legal precedents.

Accordingly, the claim for Discrimination on the Grounds of Age is not Well Founded and is not upheld.

As this was the principal plank of the complaint it follows that the associated complaints for Discriminatory Dismissal, Discrimination in Conditions of Employment, Discriminatory Dismissal and Dismissal because Discrimination was Opposed are also not found to be Well Founded.

4: Decision:

Section 79 of the Employment Equality Acts, 1998 – 2015 requires that I make a decision in relation to the complaint in accordance with the relevant redress provisions under section 82 of the Act.

The Complaints of Age Discrimination, Discriminatory Dismissal, Disclination in Conditions of Employment, Discriminatory Dismissal and Dismissal because Discrimination was Opposed are deemed to be Not Well founded.

The Complainant was not Discriminated against.

Dated: