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Upper Qualifying Age Decision

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The Employment Appeal Tribunal has today handed down the long-awaited decision in HARVEST TOWN CIRCLE v RUTHERFORD, dealing with the question of whether the upper qualifying age for unfair dismissal and redundancy is contrary to Article 141 of the Treaty of Amsterdam.

Harvest Town Circle dismissed Mr Rutherford, who was aged 67. He claimed unfair dismissal. The Respondent relied on sections 109 and 156 of the Employment Rights Act 1996 (which states that employees cannot claim unfair dismissal / redundancy if they are over the normal retirement age, presumed to be 65).

Mr Rutherford responded by arguing that ss 109 and 156 were contrary to Article 141 - ie equal pay for men and women. This is because unfair dismissal and redundancy rights count as 'pay', and more men than women work beyond age 65. Therefore the upper qualifying age is indirectly discriminatory on grounds of sex against men, since more men will work beyond 65 and therefore fail to receive the 'pay' of unfair dismissal and redundancy rights.

The Employment Tribunal found for Mr Rutherford and, following the earlier case of NASH v MASH/ROE [1998] IRLR 168, held that ss 109 and 156 were unlawful and should not be followed.

The EAT overturned the tribunal's decision on technical points, but left the matter open for future attempts.

The basis of the decision was twofold:

First, the EAT held that the statistics used by the employment tribunal were unsatisfactory. It gave guidance on the statistics that would probably be needed to attack ss 109 and 156 successfully, and remitted the matter back to the employment tribunal.

Secondly, it held that the tribunal had erred in failing to invite the Secretary of State to give evidence on objective justification. It held that it was not for a small employer to justify such a fundamental statutory provision, and the Secretary of State should - if necessary - be witness summonsed to explain how the sections can be objectively justified or, alternatively, explain why he was not going to attempt to justify them.

The upper qualifying age saga has not been laid to rest. The EAT's guidelines on the necessary statistics (which are set out in detail in the
decision) are cumbersome and will be an extremely difficult hurdle to overcome. Nevertheless, there can be little doubt that an attempt will be made. The decision is undoubtedly correct - and it is not for the EAT to make findings of facts on statistics that are not currently available.
However, it means that employers remain uncertain as to whether they have immunity from unfair dismissal claims when dismissing staff over retirement age.