Age Discrimination legislation a simple guide

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              Employment Equality (Age) Regulations 2006: a simple guide


Employment Equality (Age) Regulations were approved by Parliament in March 2006 and
come into force in October.

The Regulations transpose to the UK the EU Equal Treatment Directive of November 2000
which committed Member States to legislate on age, disability, sexual orientation, religion and
belief. Prior to this legislation the UK had a voluntary Code of Good Practice on age
introduced by the Government in 1999 (see www.agepositive.org.uk)

Employment and training decisions based on age

The law makes it unlawful to take decisions on employment and vocational training which are
based on a person’s chronological age rather than their competence. This covers, for
example, recruitment, selection, pay and benefits, promotion, dismissal, redundancy,
retirement and training. The definition of employment includes contract workers, the self
employed and most office holders.

The law covers direct age barriers (for example, recruitment limited to 30-40 year olds) and
indirect barriers, i.e. action which indirectly has an impact on some age groups (for example,
recruitment limited to those with a qualification which has only existed for five years, thus
ruling out those over 30). The law outlaws harassment (bullying) and victimisation of people
on account of their age.

It does not include
     discrimination in goods and services such as differential insurance rates, financial
      services or health services. However some of these have an effect on costs of
      employing certain age groups and may have an indirect effect on employment;
     education or voluntary unpaid work;
     duties on public bodies to promote age diversity, such as those that apply in the Race
      Equality Duty on public bodies now being extended to gender and disability.

Age range

There is no lower age limit (unlike in the USA where the law applies from the age of 40).
Because the law concerns work and training the effective lower age is 16. There is no upper
age limit - but see below on retirement and employment rights.

Exemptions: objective justification of age-based practices

The Age Regulations include a wider range of possible exemptions than other discrimination
law. If challenged the exemptions have to be justified as legitimate aims whose
consequences in terms of discrimination are proportionate to the importance of the aim. It will
also be necessary to demonstrate that there is not some other way to meet the aim which
does not have the same level of discriminatory consequences.

The main categories of exemptions are:

A. “genuine occupational qualification” (a gender example is the need for women to
undertake various forms of personal care and hygiene work). It has proved hard to find
examples on age which would stand up to rigorous testing.
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B. Employers’ legitimate aims. In principle, almost any age-based decision by an employer
can be put forward as legitimate. The circumstances for a legitimate aim are not spelt out in
the legislation or the official guidance. The EU Directive quoted a number of possible
examples such as limiting training on grounds of age because of the need to gain a pay back
on costs prior to retirement. When the Government was consulting on the draft regulations a
number of possible grounds for age-based decisions were cited, such as workforce and
succession planning, health and safety, and payback on recruitment costs. But these are not
built into the legislation

Extra costs associated with employing someone of a specific age group are not by
themselves justification for an exemption.

C. Exemptions set out by Government in the Regulations.

Various areas of public policies set by Government are exempted. This means that employers
do not need to justify them. However, this does not remove the rights of the employee to
challenge any specific situation related to these broad categories. If a challenge was upheld
in an Employment Tribunal it would have to go to higher courts and ultimately to the
European Court of Justice to determine whether the UK Government policy was in breach of
EU law. The main categories are:

Long service and loyalty payments. Benefits gained after five or ten years’ service are by
definition not available to younger age groups (so are indirectly age discriminatory). Any
benefits based on up to five years’ service (not necessarily continuous) will automatically be
justified. Benefits based on more than five years’ service have to be justified by each
employer by reference to their circumstances. Pay scales of over five years would therefore
normally fall away.

Other laws with age criteria. This is known as the statutory exemption so that other laws
with age criteria (licensing laws, criminal justice acts, etc.) are excluded.

Minimum wages. There are three age bands for the minimum wage, designed to encourage
continuation in education post 16. They are retained.

Pensions. State Pension and social security arrangements with age criteria are excluded. An
extensive list of age criteria related to occupational pensions is excluded with the general aim
of leaving private pension arrangements as little disturbed as possible. This includes
minimum and maximum ages for admission to pension schemes and the use of age in
calculating pension benefits and payments.

Redundancy pay. The two age bands (under and over 41) for determining the minimum level
of statutory redundancy pay are retained. The case for the higher rate per year of service
after age 41 is justified by reference to the increased difficulty of finding a new job in later
career.

Retirement and employment rights.

It is unlawful to have a Normal Retirement Age (NRA) below 65 for employees unless an
employer can demonstrate exceptional circumstances.

It will be lawful to set an NRA of 65 (known as the National Default Retirement Age) or above
or to have no NRA.

A Fair Retirement Procedure at or post NRA is set out in the Regulations. Under a timetable
starting 12 months before the NRA there is
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    an employer duty to inform the employee of plans for retirement;
    an employee right to request to stay on;
    an employer duty to respond to the request and hold a review meeting where the
     request is refused.

There is no redress for the employee where the request is refused and no requirement on the
employer to explain the reasons. If the procedure is followed correctly, it is automatically a
“fair dismissal”.

If the employer gives notice of intent to retire an employee less than 6 months before their
Normal Retirement Age, then the employee can challenge the action as unfair dismissal. If
the employee has still not given notice 2 weeks before the NRA, then that would automatically
be unfair dismissal.

These arrangements will be monitored for five years and then reviewed in 2011.

The law will remove the ceiling of 65 on employment rights. Given the procedure for fair
dismissal on grounds of retirement after 65 the change may have limited impact in retirement
cases.

Training

The definition of training suggested by Government covers almost all forms of adult learning
including careers and learning advice. The law therefore covers all activity in Further
Education colleges, universities, privately run training courses, and workplace training. It is
unlawful to base decisions on who is offered training or the terms on which it is offered on
age.

The Government have taken the view it is lawful for the funding of training to be based on
age. There are therefore several training programmes funded for those under 30 or under 25
but not for those over those ages.

It will be lawful to run training programmes targeted at those who are under represented in
learning activity. An example would be IT training concentrating on those over 60. This is
called “positive action”. It would not be lawful for this or other employment service to be
exclusively for one age group.

Dispute resolution

The main route for dispute resolution will be Employment Tribunals with the same procedures
as for existing discrimination law. There will not be an Age Discrimination Commission like the
current Gender, Race and Disability commissions. Support and guidance for employees and
employers will be part of the functions of a new Commission on Equality and Human Rights
(CEHR). Subject to the legislative timetable, this will be set up in stages from 2007.

ACAS Guidance will be available soon. The normal role of ACAS to mediate cases before
they go to a Tribunal will apply. There are very limited resources available to assist individuals
to seek redress except in test cases which settle a point of law in the higher courts. The
CEHR will only be able to support key cases testing a new point of law.


Patrick Grattan TAEN
Tel: 020 7843 1590
E mail: taen@helptheaged.org.uk
April 2006

				
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