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Compliance

A sign of maturity

Open-access content 22nd August 2008

The Employment Equality (Age) Regulations 2006  are due to come into effect on 1 October. Many FMs will be well prepared, but as  a final reminder, here are the key points to watch

 

by Sarah Lamont

 

22 September 2006

 

It's a change that will impact upon every aspect of the employment relationship - prohibiting discrimination from recruitment to termination - and even affecting relationships that have come to an end. But they do not just tackle ageism in relation to older workers - after all everyone has an age and therefore all employees are protected.

 

The protection is expressed in terms of direct and indirect discrimination, harassment and victimisation. Employers can be vicariously liable for discrimination unless they took reasonably practicable steps to prevent it. Training for employees will be a key safeguard for employers here.

 

Another familiar concept is the use of a comparator whose circumstances must not be materially different to the person claiming discrimination. However, a key difference is that, unlike other most other forms of discrimination, age discrimination can be objectively justified. Employers should be aware that an individual's age for the purposes of direct discrimination includes a person's apparent (rather than actual) age.

 

Justification

 

In the regulations, both the direct and indirect discrimination claims can be successfully defended if the employer can show the treatment is a "proportionate means of achieving a legitimate aim". In practice, this means that employers should make sure that they keep some record as to why the practice or treatment is for a proper business aim and is proportionate when balanced against the discriminating effect.

Benefits

 

The provision of benefits to staff is affected in two main ways. First, any benefit that depends on length of service may well be indirectly discriminatory against younger employees who have less length of service. These benefits can still be provided as long as the entitlement on which the benefit is based does not exceed five years. If it does, it must reasonably appear to the employer that this use of the length of service "fulfils a business need of his undertaking (eg, by rewarding the experience of some or all of workers)". Again, evidence of this will be needed, such as through monitoring, staff-attitude surveys or focus groups.

 

The second way in which benefits are affected is where they are only payable up to a certain age. So, the fact that it may be more costly to provide permanent health insurance to older employees, for example, is no justification for excluding them. In the same way, providing free medicals to staff over a certain age will be unlawful.

 

The regulations make it clear that it is unlawful to discriminate against an employee by dismissing them by reason of age, but the default retirement age is an exception to this. So, if an FM wishes to have a normal retirement age below 65, this will be unlawful unless it can be justified.

 

Retirement

 

In practice, justifying a normal retirement age below 65 is likely to be very difficult. The termination must also be for "retirement". A fair retirement is one that takes effect on or after the default retirement age and where the employer has given the employee written notice of the date of their intended retirement and told him/her about their rights to request to continue working.

 

Employees will have the right to request not to retire on the intended date. Once an employer receives such a request, the "duty to consider" procedure is triggered. Briefly, this means that the FM must hold a meeting to discuss the request with the employee within a reasonable period after receiving the request. FMs must consider any request carefully and in good faith. Failure to fully comply with the procedure can result in a tribunal award of up to eight weeks pay. It can also mean the dismissal is unfair.

 

Redundancy

 

The regulations cover enhanced redundancy payments. These are allowed only if they are based on the statutory redundancy payment multipliers. The statutory redundancy scheme will not substantially change. Any other types of enhancements based on age or length of service will be unlawful unless they can be objectively justified.

 

Sarah Lamont is a partner at Bevan Brittan (a BIFM corporate member)

 

The key changes,at a glance

 

  • Coming into force 1 October 2006

  • A prohibition on direct and indirect discrimination (unless it can be objectively justified) -  even post termination of employment

  • Harassment and victimisation on grounds of age outlawed

  • FMs will be liable for the acts of their employees

  • A default age of retirement of 65

  • A duty for employers to consider employees' requests to continue working after they are due to retire

  • Limited use of length of service criteria for benefits

  • Certain exemptions in relation to occupational pension schemes


FM QUICK FACTS

 

  • Acas has published its guidance Age and the workplace  which gives checklists and other help for preparation for the regulations

  • The DTI has published eight 'age legislation factsheets' which cover topics such as 'objective justification', 'service-related benefits', 'occupational pension rights' and 'redundancy'

 

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