FULL RECOMMENDATION
SECTION 83 (1), EMPLOYMENT EQUALITY ACTS, 1998 TO 2011 PARTIES : CONNAUGHT AIRPORT DEVELOPMENT LIMITED T/A IRELAND WEST AIRPORT KNOCK (REPRESENTED BY MS MARY FAY B.L. INSTRUCTED PEMBROKE SOLICITORS) - AND - JOHN GLAVEY (REPRESENTED BY SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION) DIVISION : Chairman: Ms Jenkinson Employer Member: Mr Marie Worker Member: Ms O'Donnell |
1. Appeal of Adjudication Officer's Decision No: ADJ-00001463.
BACKGROUND:
2. The Employer appealed the decision of Adjudication Officer to the Labour Court on 11 August 2016. A Labour Court hearing took place on 5 April 2017. The following is the Court's Determination:
DETERMINATION:
This is an appeal by Connaught Airport Development Ltd t/a Ireland West Airport Knock against the decision of an Adjudication Officer of the Workplace Relations Commission under the Employment Equality Acts 1998 – 2011(the Acts). Mr John Glavey complained that he was subjected to discriminatory treatment on the age ground in terms of Section 6(2)(f) of the Acts and contrary to Section 8 of the Acts when his former employer imposed a mandatory retirement age of 65 years.
For ease of reference, the parties will be referred to as they were at first instance, therefore Connaught Airport Development Ltd t/a Ireland West Airport Knock will be referred to as “the Respondent” and Mr John Glavey will be referred to as “the Complainant”.
The Adjudication Officer held that the Complainant had established aprima faciecase of discrimination on the ground of age, and held that his complaint of discrimination was well founded. He awarded reinstatement and required the Respondent to pay the Complainant compensation in the sum of €6,500 for the effects of discrimination.
The complaint was referred to the Workplace Relations Commission on 20thJanuary 2016.
Background
The Complainant was employed as a Senior Bar Tender within the catering department of the Airport until his retirement on 6 January 2016. He was initially employed by Campbell Catering at the Airport from 1991 until 2003 and transferred to the employment of the Respondent in 2003 under theEuropean Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003(the Regulations) when the Airport’s catering staff was taken over by the Respondent.
The Respondent is a regional airport which opened in May 1986 and is now the fourth largest airport in Ireland directly employing 159 staff and additional temporary staff in the summer season. It directly employs all staff involved in the day to day running of the airport. The critical operational functions include, Air Traffic Control; Fire and Security; Airline Ground Handling Services; Aircraft Refuelling and Technical and Navigation Services. Other commercial functions include Retail and Catering services.
Summary of the Complainant’s Case
Ms Martina Weir, SIPTU on behalf of the Complainant submitted that the Complainant had been discriminated against as his employment was terminated when he reached his 65th birthday. Ms Weir clarified for the Court that the redress sought by the Complainant is the award of €6,500 in compensation as decided by the Adjudication Officer.
Ms Weir submitted the following points in support of the claim:-
- •Neither the Campbell Catering contract of employment nor the Respondent’s contract of employment post the transfer furnished to him in 2006 contained a retirement age. The latter contract was the subject of negotiations between the Respondent and SIPTU and resulted in the final proposals being balloted upon by those employees, including the Complainant, who transferred to the Respondent in 2003.
•It came as a surprise to the Complainant when the Respondent informed him that he would be retiring in January 2016.
•Negotiations conducted between 2004 and 2006 concluded in an agreement to harmonise the terms and conditions of employment of former Campbell Catering's staff with existing terms for established Airport employees. However, the new contracts issued did not fix a retirement age, despite the Respondent having the opportunity to do so.
•While the Complainant was aware of retirements from the Airport he may not necessarily have been aware of the ages of the retirees. There were at least two employees who were retained beyond their 65th birthdays.
•The Complainant is fit and well and had no difficulty carrying out the duties associated with his job. Therefore there is no justification for a mandatory retirement age in this situation.
•The Government has increased the age for receipt of the state pension to 66 years; there is a requirement on those between 65 and 66 years to be available for work. Therefore there can be no justifiable objective reason for the Respondent’s decision to place the Complainant in such a position, and no legitimate aim or objective, can be served which could not be achieved by allowing the Complainant to remain until he reaches 66 years.
•The Complainant is one of a few who hold a 39 hour per week contract of employment whereas new recruits are on temporary and/or part-time contracts, and this seems to be the influencing factor in the decision taken by the Respondent, as opposed to the aim of freeing up positions for younger people entering the employment.
•The Complainant is not a member of an occupational pension scheme and will not qualify for the state pension until he reaches 66 years. While the Respondent introduced an occupational pension scheme in 2010, the Complainant did not join as it was his belief that he would not gain any benefit from it.
Summary of the Respondent’s Position
Ms Mary Fay, B.L., instructed by Pembroke Solicitors, on behalf of the Respondent, disputed the claim that the Complainant was discriminated against on the age ground.
Ms Fay submitted the following points in support of the Respondent’s position:-
- •The Respondent’s age of retirement of 65 years had been justified within the meaning of section 34(4) of the Acts and Article 6 of the Directive 2000/78/EC “Establishing a General Framework for Equal Treatment in Employment and Education” (the Directive), and that the means chosen by the Respondent are both appropriate and necessary for achieving that aim.
•It was an express term of the Complainant's terms and conditions of employment with Campbell Catering that employment would not continue past an employee's 65th birthday. The Complainant signed and accepted these terms in 1998. While all Campbell Catering employees who transferred to the Respondent pursuant to the Regulations in 2003 did so on their existing terms and conditions, some of those terms were revised pursuant to a collective agreement reached with SIPTU in 2004. All affected employees including the Complainant were issued with new contracts of employment.
•An occupational pension scheme has been available to all hourly paid employees, including the Complainant, since 2011 which provides for employees to make a contribution of 5% to the scheme and the Respondent makes a matching contribution. All employees of the Respondent were notified of the introduction of the scheme and the pension provider gave presentations to the staff in 2010. Prior to 2011 the Respondent facilitated all employees wishing to make arrangements for a private pension through a PRSA. The Complainant elected not to make contributions to a PRSA or the occupational pension scheme once established.
•The Respondent strives for cohesion throughout the workforce and has one universal retirement age for all staff. This ensures consistency amongst all of its employees and creates certainty in succession planning for the airport.
•This certainty allows it to plan ahead to find suitable replacements for workers who leave or are coming up to retirement.
•It allows the Respondent to avoid the need to terminate an employment contract in situations which are humiliating for workers by reasons of their advanced age, thus preserving their dignity and avoiding humiliation and the need to avoid costly disputes about capacity or underperformance.
•Having a retirement age at 65 years allows it to free up positions so that younger workers can enter the Respondent workforce and have a defined career path where their ambitions can be realised. The lack of new young entrees to the airport would have an adverse effect not only on the catering department, but on all departments within the Respondent, especially critical ones like the fire service, security, ground services and customer service. This would not only have an effect on productivity but also on health and safety.
•While it is accepted that the new contract did not contain a mandatory retirement clause, it is submitted that such a clause should be implied as it has been the accepted custom and practice of the Respondent since 1986 for employees to retire when they reach the age of 65, save in the most limited and exceptional of circumstances. The Complainant would have been aware, or ought reasonably to have been aware of this.McCarthy v HSE[2010] ELR 165;andSweeney v Aer Lingus Teo[2013] 24 ELR 162.
•The two exceptions related to (i) an employee who worked in retail retired in July 2009 at age 65, approximately 11 months post her 65th birthday. This arose in exceptional circumstances due to operational requirements at that time as passenger numbers increased by 73,080 from 2007 to 2008 and (ii) an employee, who was compulsorily retired at age 65, was re-engaged on a fixed term contract in exceptional circumstances relating to work for a stand-alone capital runway overlay project and his salary was reclaimed from the Department of Transport.
•The Respondent fully believes in creating promotional opportunities for more junior staff and its preference is always to promote from within. Job vacancies are posted internally first, as internal promotion is good for staff morale.
•The sharing of employment opportunities is particularly relevant in the instance case as the Respondent is the main employer in the area at a time when employment opportunities in the area are limited.To free up jobs so that younger workers can enter to the workforce and younger workers have an opportunity for advancement / promotion.
•The Respondent endeavours to establish a balanced age workforce to ensure motivation and dynamism are at the core of each department. This can be increased with the prospect of promotion within each department. The staff turnover rate for permanent employees is very low, average turnover rate from 2013 to present is 2.7%.
In support of her contention that there were objective grounds for the imposition of a retirement age, Ms Fay relied upon a number of cases,viz.Palacios de la Villa v Cortefiel Services SA(Case c-411/05) [2007] ECR 1-8531wherethe Court of Justice accepted Spain's justification for a compulsory retirement age of 65, namely that retirement ages assisted in promoting employment for younger people, particularly in difficult economic circumstances. Similarly, inDomnica Petersen v Berufungsausschuss fur Zahnarzte fur den Bezirk Westfalen-Lippe(Case c-341/08) [2010] ECR 254the Court of Justice appeared to accept that sharing out of employment between the generations (in this case through the forced retirement at 68 of the exercise of the activity of a public panel dentist in Germany) was not precluded by Article 6(1) if, taking into account the situation in the labour market concerned, the measure was appropriate and necessary for achieving that aim.
InRosenbladt v Ollerking Gebaudereinigungsge GmbIta referral concerning a provision for compulsory retirement at age 65 in a collective agreement for the commercial cleaning sector, the Court of Justice held that the aims of sharing employment between the generations, making it easier for younger workers to find work, particularly, at a time of chronic unemployment and not requiring employers to dismiss employees on grounds of incapacity, which might be humiliating, were in principle capable of objectively and reasonably justifying a difference in treatment on grounds of age.
Also,John Roche v Complete Bar SolutionsDEC-E2013-197where similar arguments regarding certainty in business planning and encouraging staff morale by using consequential vacancy as an internal promotion opportunity was accepted by the Equality Tribunal as justifying a retirement age of 65 in respect of the Respondent's business servicing equipment in licenced premises.
Evidence
Mr Eoin Flanagan, HR Manager:
Oral sworn evidence was given by Mr Eoin Flanagan, HR Manager since 2014, gave evidence on behalf of the Respondent. He said that while the Respondent does not have a policy on retirement age, the custom and practice had been that all employees retire at age 65 years. He said that it was “a given” that employees retire at 65 years. He said that all contracts of employment for all new employees state a retirement age of 65 years.
Mr Flanagan said that the Complainant was invited to attend all retirement functions of employees who retired. He referred to the two exceptions and said that there were exceptional circumstances in those cases. The first was kept on due to the significant increase in the volume of passengers at the time and the second was brought back from retirement to undertake a special project (upgrade of a runway), which was funded externally.
Mr Flanagan said that approximately half of the Respondent’s employees are on full time contracts and the remainder are on part time contracts. All vacancies are advertised internally as the Respondent has a policy to promote from within. He outlined for the Court the various roles within the airport, i.e. those in critical functions and those in commercial/retail functions and number of employees in each role. He stated that there was interchangeability within the roles within each of the functions.
In cross examination, Mr Flanagan said that the Complainant was replaced by a person on an “if and when” contract, a part time casual contract on a fixed term basis, renewable every six months. He was placed on the new entrants’ scale which is a five point scale. Mr Flanagan said that he was not given a permanent contract as it is the Respondent’s policy for new starters to be put on a part time casual contract. Where such contracts are renewed for a period of four years then employees are given a contract of indefinite duration. All new contracts since 2014 now contain reference to a retirement age of 65 years. However, Mr Flanagan told the Court that as the Complainant’s replacement is on a fixed term contract, it does not contain such a reference.
Mr Flanagan said that the Complainant’s job was not advertised internally; instead his replacement was recruited into the job having submitted a CV to the Respondent at an earlier stage. As he was employed elsewhere at the time, he did not commence employment with the Respondent until 16 May 2016 and in the meantime the Complainant’s hours were distributed among other employees.
Mr John McCarthy, Operations and Commercial Manager
Mr John McCarthy, Operations and Commercial Manager had previously been employed as a Unit Manager with Campbell Catering based at the Airport. Prior to the transfer in 2003, he became an employee of the Respondent. He then became responsible for the pending arrival of catering staff to the airport in 2003. He said that it was clear that 65 years was the retirement age in Campbell Catering and in the airport that would have been known. He said that during the negotiations with SIPTU, the issue was never raised.
Mr McCarthy said that with 14 departments across the airport it is important to have cohesion; therefore a common retirement age is required. He said that as the airport is very heavily regulated it suits to have a retirement age of 65 years and the Respondent has been operating on that basis for the past 10 years.
The Law Applicable.
Section 6(1) of the Employment Equality Acts 1998 and 2004 (the Act) provides, in relevant part, as follows: -
- ‘‘(1) For the purposes of this Act and without prejudice to its provisions relating to discrimination occurring in particular circumstances discrimination shall be taken to occur where—
- (a) a person is treated less favourably than another person is, has been or would be treated in a comparable situation on any of the grounds specified in subsection (2) (in this Act referred to as the ‘discriminatory grounds’)
which—
(i) exists,
(ii) existed but no longer exists,
(iii) may exist in the future, or
(iv) is imputed to the person concerned,
- (a) a person is treated less favourably than another person is, has been or would be treated in a comparable situation on any of the grounds specified in subsection (2) (in this Act referred to as the ‘discriminatory grounds’)
(4) Without prejudice to subsection (3), it shall not constitute discrimination on the age ground to fix different ages for the retirement (whether voluntarily or compulsorily) of employees or any class or description of employees.
Subsection (3) deals with occupational benefit schemes and is of no relevance to the issues arising in this case.
The Act gave effect in domestic law to Council Directive 2000/78/EC of 27 November 2000 establishing a general framework for equal treatment in employment and occupation (the Directive). Recital 14, 25 and Articles 2 (5), 4(1) and 6 (1) of the Directive are of particular relevance to the instant case.
Recital 14 provides: -
“This Directive shall be without prejudice to national provisions laying down retirement ages.”
- The prohibition of age discrimination is an essential part of meeting the aims set out in the Employment Guidelines and encouraging diversity in the workforce. However, differences in treatment in connection with age may be justified under certain circumstances and therefore require specific provisions which may vary in accordance with the situation in Member States. It is therefore essential to distinguish between differences in treatment which are justified, in particular by legitimate employment policy, labour market and vocational training objectives, and discrimination which must be prohibited.
- "Notwithstanding Article 2(1)and 2(2),Member States may provide that a difference in treatment which is based on a characteristic referred to in Article 1 shall not constitute discrimination where, by nature of the particular occupational activities concerned or of the context in which they are carried out, such acharacteristic constitutes a genuine and determining occupational requirement, provided that the objective is legitimate and the requirement is proportionate."
- Notwithstanding Article 2(2), Member States may provide that differences of treatment on grounds of age shall not constitute discrimination, if, within the context of national law, they are objectively and reasonably justified by a legitimate aim, including legitimate employment policy, labour market and vocational training objectives, and if the means of achieving that aim are appropriate and necessary.
Issues for Consideration by the Court
Existence of a contractual retirement age
Section 34(4) of the Act,prima facie,allowed the Respondent to fix a retirement age without contravening the prohibition of discrimination on grounds of age. The jurisprudence of the CJEU on the circumstances in which compulsory retirement is saved by Article 6 of the Directive is relevant only if the Court finds that a retirement age was in fact fixed by the Respondent and that the retirement age applied to the Complainant.
InEaragail Eisc Teoranta v Richard LettEDA1513 the Court held that as a matter of general principle, a termination of employment by way of retirement should be distinguished from a dismissal on grounds of age. A retirement occurs where the employment comes to an end pursuant to a condition of employment which limits an employee’s tenure to the point at which they attain a specified age. It held that a term of employment regarding a retirement age, within the provision of Section 34 (4) of the Act, can be provided in an employee’s conditions of employment either expressly or by implication, or it can be provided by incorporation where some other document or instrument, of which the employee had notice, can be read in conjunction with the formal contract of employment. The Court further accepts that an employer’s employment policy in relation to retirement can take effect as a contractual condition of employment which is,prima facie,protected by Section 34(4) of the Act. However, in the Court’s view that could only arise where the policy is promulgated in such a manner that the employees to whom it applies either knew, or ought to have known, of its existence.
On that point the judgment handed down by Hedigan J inMcCarthy v HSE[2010] 21 ELR 165 is instructive. In that case a public servant sought to challenge a decision of the HSE requiring her to retire at age 65. The HSE, in common with all public sector employments, maintained an employment policy requiring employees to retire at age 65, in line with certain statutory provisions. Ms McCarthy claimed that the policy did not apply to her because she had never been informed that she would be required to retire at that age and no such term was included in her contract of employment.
It is noteworthy that rather than relying on the existence of the policy,per se,the approach taken by the Court was to consider if the employer’s policy on retirement took effect as an implied term in the applicant’s contract of employment. Having reviewed the evidence and the submissions made by the parties Hedigan J said: -
- “In addressing the substantive issues raised, the crux of the application lies in whether the retirement age of 65 could be viewed as having been implied into the contract as submitted by the respondent. Two alternative approaches were suggested utilising the “officious bystander test” on the one hand and implication by custom on the other. It is my opinion that in the circumstances of the case, the former provides a more suitable formula to determine whether such a term has been implied, although there is necessarily a large degree of overlap. The court is of the opinion that such a term should indeed be implied into the applicant's conditions of employment. The applicant is a highly intelligent woman who is legally qualified. It is difficult to accept that she had no knowledge of the retirement age applicable in that part of the public service in which she worked. Furthermore, irrespective of any actual knowledge of this fact, I would consider the dicta of Maguire P. in O'Reilly that anyone concerned “should have known of it or could easily have become aware of it” to be particularly apt in this case. Moreover in addition to the broad awareness of the retirement age among most working adults, the applicant may be deemed as “on notice” that there was an applicable retirement age by virtue of the superannuation scheme. The superannuation scheme, of which she was a member, made reference to the existence of a retirement age, and more specifically, a cut-off for contributions at age 65. I therefore find that such a term can be implied into the terms and conditions of employment.”
- “Prima facie that which in any contract is left to be implied and need not be expressed is something so obvious that it goes without saying that if, while the parties were making the bargain, an officious bystander were to suggest some express provision for it in the agreement they would testily suppress him with a comment ‘Oh of course’.”
- “…so notorious, well-known and acquiesced in that in the absence of agreement in writing it is to be taken as one of the terms of the contract between the parties…it is necessary in order to establish a custom of the kind claimed that it be shown that it was so generally known that anyone concerned should have known of it or easily become aware of it.”
Findings of the Court
It is accepted that the Complainant’s contract of employment with the Respondent did not contain any express term as to retirement age.The Respondent relied on the Campbell Catering contracts which stated:-
- “the minimum age of employment is 18 years of age and employment shall not continue beyond the 65thbirthday.”
The Court notes that the terms and conditions of employment of those employees who transferred from Campbell Catering in 2003 were the subject of negotiations between the Respondent and SIPTU, and resulted in enhanced terms for the former, including the Complainant. These terms were eventually balloted upon and agreed in 2004. Each of the employees affected, including the Complainant were issued with new contracts of employment incorporating all the revised terms in October 2006. However, it contained no provision regarding retirement age, despite the Respondent having the opportunity to do so.
In 2010 the Respondent and the Union were before the Court under the Industrial Relations Acts, where the Union sought the introduction of a defined contribution pension scheme for hourly paid employees at the airport, in line with that in existence for management and salaried staff. The Court recommended the introduction of a defined contribution pension scheme which was duly introduced. This scheme provided for a normal retirement age of 65 years and was open to any employee interested in joining the scheme to opt into it. For reasons outlined to the Court, the Complainant decided not to join. Likewise the Court notes that despite having the opportunity to do so the Respondent did not revise the Complainant’s contract to include the provisions of the pension scheme thus incorporating its terms into the contract.
The Court notes that the contract of employment issued to the Complainant’s replacement does not contain a retirement age; however, it does make reference to the option to join the pension scheme.
The Court notes that the first retirement that occurred in the Respondent was in November 2006, after the Complainant transferred over to the Respondent and after he was supplied with new terms and conditions that had been the subject of negotiations between the Respondent and SIPTU and which he was required to ballot on. There have been 10 retirements since 2006, two of whom worked beyond their 65thbirthday due to exceptional circumstances.
Having regard to the all the circumstances, the Court cannot accept that the Complainant had knowledge of a retirement age of 65 years. The Respondent had ample opportunity to inform the Complainant of a requirement that he retire at age 65. No evidence was adduced of the Complainant having been so informed or having been provided with any document from which such a requirement could have been discerned. There was no express term in his conditions of employment requiring him to retire at age 65 years and, in the Court’s opinion, no such term can be regarded as having been implied or incorporated on any of the accepted tests.
In these circumstances the Court must hold that the Respondent had not fixed a retirement age in respect of the Complainant and that he was dismissed because of his age. Therefore, the Court finds that the Respondent cannot avail of Section 34(4) of the Act. In such circumstances it is not necessary for the Court to consider Respondent’s arguments of objective justification for a retirement age of 65 years.
Determination
For the reasons set out above, the Court finds that the Complainant herein was dismissed by the Respondent by reason of his age, and that this dismissal constituted an act of discrimination within the meaning of Section 6(2)(f) of the Act. Therefore the Respondent’s appeal is disallowed.
Having been told that the Complainant was not seeking reinstatement, the Court determines that the appropriate form of redress is an award of compensation pursuant to Section 82(1)(c). Therefore the Court orders the Respondent to pay the Complainant the sum of €6,500 for the effects of the Act of discrimination.
The Decision of the Adjudication Officer is varied accordingly.
The Court so determines.
Signed on behalf of the Labour Court
Caroline Jenkinson
24 April 2017.______________________
MNDeputy Chairman
NOTE
Enquiries concerning this Determination should be addressed to Michael Neville, Court Secretary.