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Employers should beware that age-related claims may not only be brought by older workers, says Mark Bland
Younger members of the judiciary have been successful in an age discrimination claim in the employment tribunal. The younger judges had attacked the introduction of a new pension scheme that would see them lose out compared to their comparators because of their age.
The ruling in McCloud and Others v Ministry of Justice, which is likely to be appealed by the Ministry of Justice and taken before the Employment Appeal Tribunal, has a number of wider implications for businesses in all sectors regarding age discrimination and pension schemes. Furthermore, it highlights that age discrimination is a two-way street and should not be perceived as only operating against older people.
A closer look
The original judicial pension scheme was popular among judges for several reasons. It was a non-contributory scheme, which meant judges did not have to make any payment into it, and it also provided them with a substantial lump-sum payment on their retirement. However, the government decided that this was too generous and too expensive, opting to introduce a new judicial pension scheme that was far less generous, and requires the judges to pay a contribution to their pension pot like most other people.
When the new scheme was introduced, it was decided that there should be some transitional provisions. Existing judges who were nearing retirement age were to be protected to enable them to stay in the old scheme up until their retirement – a notion that came under attack from younger judges who would lose out. It was the transitional arrangements rather than the scheme itself that was found to be discriminatory.
The case highlights that there is a legitimate defence to a claim of indirect discrimination that the action taken, although discriminatory, is a proportionate means of achieving a legitimate aim. For instance, in this case, although the government accepted that the transitional arrangements were clearly discriminatory against younger members of the judiciary who were adversely affected, this was a proportionate means of achieving the introduction of a new money-saving pension scheme, which was more in line with other schemes within the government’s service.
According to the tribunal, however, the move was not a proportionate means of achieving a legitimate aim, and there were other, fairer methods that could have been brought in that would not have discriminated against younger members of the judiciary. It should be noted this defence is not available in cases of direct discrimination.
The bigger picture
It is important to note in the aftermath of this case that age discrimination does not only encompass attacks on the older generation, and young people can be treated unfairly because of their age, too. The government also left itself vulnerable to accusations of sex and race discrimination, as the younger cohort of judges included far more women and individuals from ethnic minorities.
The revision and changing of pension schemes in both the public and private sectors has raised a number of issues about age discrimination, because most changes in pension provision have meant that older people nearer retirement are protected while their younger colleagues are forced to accept less favourable pensions under the new schemes.
While the old final salary schemes have now almost all been abolished because they were proving impossible to maintain owing to their overly generous conditions, the recent case provides a stark warning to businesses to always to be wary of indirect discrimination, as the implications can be just as severe as those for intentional direct discrimination.
Mark Bland is a partner at Percy Hughes & Roberts
Story via – http://www2.cipd.co.uk/pm/peoplemanagement/b/weblog/archive/2017/01/26/younger-judges-win-age-discrimination-tribunal.aspx