Employment Update June 2009: Age discrimination

10 June 2009

Employment Group

Lawful use of length of service as redundancy selection criterion

The Court of Appeal has upheld the High Court decision in Rolls-Royce v Unite that length of service as a selection criterion for redundancy is not necessarily unlawful under the Age Regulations.

The court said that there were two important reasons for this –

  • in the Rolls-Royce redundancy selection process, length of service was only ONE of a number of criteria used; and

  • the objective in the exercise was to achieve a balance of manpower levels across the organisation. This meant that, although the length of service criterion could potentially involve indirect discrimination on grounds of age, it could also be defended as being imposed in pursuit of a legitimate aim – especially as that aim was part of a collective agreement made between the employer and the workforce.

Points to note –

  • The court expressed its provisional view that the length of service criterion was also a 'benefit' and so fell within the exception provided by reg 32 of the Age Regulations. This allows some employee benefits to be dependent on length of service, provided that where they reflect more than 5 years' service, any such criterion must be applied 'reasonably' (reg 32(2)) - this ties in with the defence (see above) that use of the criterion was a proportionate means of achieving a legitimate aim.

  • This is a useful case for employers as it provides some guidance on how long service and/or company loyalty can be promoted without falling foul of the age discrimination legislation.