The recent decision of the Supreme Court in the case involving the retirement of a law firm partner at the age of 65 appears to have been seen in some quarters as helping employers to revert to the use of a compulsory retirement age. Employers who feel reassured that compulsory retirement has suddenly become a feasible option again are likely to be mistaken.
The law firm in this case had relied on three factors to justify compulsory retirement at 65 – retaining associate lawyers through being able to offer the prospect of partnership, facilitating workforce planning by creating realistic expectations as to when partnership vacancies would arise and creating a supportive culture which avoided or limited the expulsion of partners on performance grounds. The Court stressed that in order for business aims to be legitimate (as these were), they had to be objectives of a public policy nature and consistent with the social policy aims of the state. Such public policy aims could include inter-generational fairness and the preservation of dignity (which would include avoiding the dismissal of older workers on grounds of underperformance). If the firm’s aims had been principally to reduce costs or to improve competitiveness, they would not have had the required public policy character.
In the light of the Court’s ruling the case was sent back to the Employment Tribunal for it to consider whether the choice of 65 as the retirement age was a proportionate means of achieving the firm’s objectives. The Tribunal will have to consider this in the light of the circumstances that existed in 2006 when the retirement in this case took place: the fact that at that time 65 was the statutory compulsory retirement age which applied to employees will be a relevant factor. Justifying the choice of 65 by reference to the present circumstances would probably be much more difficult.
This case therefore is still some way from being concluded. Many employers will not share the characteristics of this law firm, in particular the tendency of members of the firm to remain in it for most of their working lives. An employer who, for example, attempts to rely solely on an objective linked to the preservation of dignity for older workers to try to justify compulsory retirement at a specified age is likely to have some major hurdles to overcome.
