Age Discrimination & Redundancy – Protection for all Ages In Redundancy

The age discrimination provisions of the Equality Act 2010 (‘EA’) apply to the processes that an employer uses when selecting candidates for redundancy. The EA specifically prohibits direct and indirect discrimination, victimisation and harassmentin these circumstances. Harassment is unlikely to be relevant in a redundancy situation and victimisation may only occur in limited situations, for example where anemployee is selected for redundancy because he or she has assisted someone else in the office in a claim for age discrimination, or brought a claim themselves.

Direct discrimination will exist where someone is treated less favourably than someone else, on the basis of age, for example where an employer sets an upper age limit on a job and an employee falls outside of this and so is made redundant. Indirect discrimination results from the effect of a workplace provision, criterion or practiceon a group of people of a certain age compared to another group of people of a certain age. Where the provision, criterion or practice has a negative effect on only one group of people this may be indirect discrimination – for example redundancy selection procedures where the newest employees are those selected for redundancy will beindirect discrimination because the newest employees are likely to be the youngest (although it is likely this can be objectively justified – see below).

There is an exception to what would usually amount to discrimination where a redundancy selection procedure can be objectively justified – i.e. it doesn’t go further than is necessary to achieve its aim, it is necessary to achieve its aim and there is no less discriminatory alternative available. Using length of service as a criteria for redundancy has been found to be objectively justifiable, so in the situation above where the newest employees are those selected for redundancy, it is likely that this will be objectively justifiable.

Redundancy payments

Everyone with two years service who is dismissed because of redundancy is now entitled to statutory redundancy and there are no upper or lower age limits anymore.Age and length of service are both used in working out how much statutoryredundancy pay someone will receive and this is not considered discriminatory as it is covered by a specific exemption. The calculation for working out statutory redundancy is:

£430 x length of time at the company x 0.5 (under 21), 1 (22-40) or 1.5 (41+)

An employer can make enhanced redundancy payments to staff who are being maderedundant without falling foul of the EA, as long as the enhanced scheme is based on the statutory scheme e.g. using the same age groups as above. A scheme that does not follow the same structure – for example, one which relies on the length of time an employee has been at a company, rather than age – does not benefit from an exemption and may be challenged as discriminatory by those being made redundant, unless it can be objectively justified. Here an objective justification may be something like the fact that older workers generally find it hard to find another job.

Redundancy related age discrimination claims

The time limit for bringing this type of claim to an Employment Tribunal is three months less one day of the conduct that amounts to discrimination or, if it was ongoing, on the last day of the conduct. An Employment Tribunal may sometimes extend this if it is just and equitable to do so but there is no guarantee that this will be done.

Where an age discrimination issue is raised, there is usually a requirement to follow the ACAS Code of Practice on Discipline and Grievance Procedures(www.acas.org.uk). The Code aims to resolve workplace disputes before court proceedings are initiated so where a situation requires the Code to be followedbefore a claim is lodged with an Employment Tribunal, this should always be done.There are some serious penalties for both employers and employees who don’t follow the Code – for example any compensation an employee receives from an Employment Tribunal may be reduced by up to 25%.