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Supreme Court rejects Seldon age discrimination appeal

25 April 2012

The Supreme Court has today handed down judgment in the age discrimination case launched five years ago by Leslie Seldon, a partner in the law firm Clarkson Wright and Jakes (CWJ), alleging that his retirement under the partnership deed when he reached the age of 65 amounted to direct age discrimination that was not objectively justified. The judgment has implications for employers seeking to apply compulsory retirement policies now that the Default Retirement Age has been abolished.

 There were three issues before the Court:

  1.  whether any or all of the three aims of the retirement clause accepted by the ET (retention of associates, workforce planning and limiting the need to expel partners through performance management) were capable of being legitimate aims;
  2. whether the firm has not only to justify the retirement clause generally but also their application of it in the individual case; and
  3. whether the ET was right to conclude that relying on the clause in this case was a proportionate means of achieving any or all of the identified aims.

On the first point, the Court held that these aims were legitimate since they were founded on the legitimate social policy aims of 'inter-generational fairness' and 'dignity' confirmed by the ECJ and CJEU in later age discrimination cases. On the second point, the Court confirmed that “where it is justified to have a general rule, then the existence of the rule will usually justify the treatment which results from it” but commented that “all businesses will now have to give careful consideration to what, if any mandatory retirement rules can be justified in their particular business”. The Court remitted the question of whether the choice of the mandatory retirement age of 65 was proportionate back to the ET.

The judgment provides a useful summary of the extent to which European age discrimination cases involving national law or collective agreements may impact on cases involving individual employers, and the tests to establish the legitimacy of aims justifying direct age discrimination. But the Court emphasised that such aims must stand up to scrutiny in that each employer must show that they are legitimate in their case.

If we have a little more clarity on what can amount to legitimate aims for retirement we are really no further forward on the issue of at what age the application of a retirement policy might be proportionate – Seldon’s case was initiated in the context of a DRA of 65 later held (just) by the High Court to be a proportionate national measure. Without that backdrop, any employer thinking about justifying a retirement age will need to be especially careful to ensure that the age selected stands up to close scrutiny.

The full judgment is here and there are useful briefings on the case from our legal partners DAC Beachcroft, Lewis Silkin and Eversheds.

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