In a recent Insight, we highlighted that age discrimination is a hot topic for 2022 and beyond. We noted both the increase in age discrimination claims being brought in employment tribunals and the fact that age is currently the most "popular" form of discrimination claim.

There are many reasons why employers should expect this focus on age to remain. In the UK, as a population we are living longer, with a high proportion of workers over 50 years of age. Figures from the Office for National Statistics show that about 1 million people in the UK left the labour market during the pandemic, with retirement most often cited as the reason. However, there are reports that the country's financial outlook and the cost of living crisis may now be ushering in the "Great Unretirement", forcing or encouraging over 50s to revaluate their plans and to enter the workforce once more. Many employers facing a difficult recruitment market and skills shortages may welcome this. This month, McDonalds has announced a recruitment drive aimed at hiring staff over the age of 50. 

Now is a good time for employers and HR to embrace age inclusion positively and proactively as part of their wider diversity and inclusion and strategic planning. In this article, we look at the legal framework and at some steps which employers can legitimately take to attract younger workers, and retain older workers, without falling foul of the legislation. Forward planning is key. Employers who try to convince an employment tribunal that different treatment is lawful are almost always best served by a carefully planned and evidence-based approach, rather than seeking to fit the facts to the possible exceptions allowed by the Equality Act 2010 (EA) only when someone complains.

Age discrimination – in summary

Age is a protected characteristic under the EA. Individuals of all ages – young and old, and everyone in between – are protected. Age discrimination occurs where an individual (employee, applicant or worker) is treated unfairly because of age, or because they are part of a particular age group. Individuals are protected from discrimination (both direct and indirect), harassment and victimisation relating to age.

Justification

Age discrimination is allowed if it can be objectively justified. Here, the burden is on the employer and it must be able to show that its actions, or the provision, criterion or practice complained about, was a proportionate means of achieving a legitimate aim. This can be challenging, as not only does the employer need to show the legitimate aim (for example, encouraging loyalty or rewarding experience) but also that its approach was proportionate (i.e. justified by the benefit achieved and also the least discriminatory way of achieving that benefit). Employers should ideally be able to rely on analytics and evidence (for example, from monitoring, staff surveys or discussion with the workforce).

Age discrimination is different from other protected characteristics in that direct age discrimination (as well as indirect discrimination) can be justified. However, the two tests are different in that, to justify direct discrimination, only social policy aims can be legitimate, whereas indirect discrimination can be justified by real business needs.

Justification always depends on a deep delve into the particular facts of the case and a forensic level of scrutiny will be brought to bear on the balancing act required to assess if the action was a proportionate way of achieving the aim. Cases where potential age discrimination has been said to be justified include cases upholding compulsory retirement ages, allowing provision of training and development opportunities, and using length of service as one criterion in a redundancy matrix.

General exceptions

The EA includes three general exceptions that apply to a number of the protected characteristics, and employers can incorporate these into an age-inclusive strategy.

• Positive action
  
  Positive action is one way in which the law supports employers in improving diversity. The EA's positive action provisions are often seen as underutilised, perhaps because of the fine line between lawful positive action and unlawful positive discrimination.
  
  Positive action is allowed when an employer reasonably believes (for example, from a review of the makeup of the workforce or from equal opportunities monitoring) that a particular age group suffers a disadvantage connected with age, has particular needs or is disproportionately underrepresented. The employer is then able to take certain actions to help overcome or minimise the disadvantage, meet their particular needs or encourage greater participation. To be lawful, such positive action needs to be proportionate and kept under review. Examples of possible age-positive actions include providing training sessions, support or mentoring primarily for younger or older workers; targeting advertising and recruitment opportunities (for example, careers fairs) at specific, underrepresented age groups; and making statements in recruitment advertisements that applications from younger or older people are welcomed.
  
  Positive action will always need a careful approach, including the rigorous stress testing of any assumptions and the benefits sought. Specific rules apply to positive action in recruitment and promotion. All this means that whether to use positive action is a strategic decision for employers, which should form part of their wider diversity and inclusion and workforce planning. Employers' use of positive action should be supported by the appropriate internal and external recruitment and other policies and training, and by appropriate evidence. Given the current economic forecast and the pressures on the recruitment market, now may be a good time for employers to think through the benefits of age-positive action.
  
  
• Occupational requirements
  
  An occupational requirement defence allows employers to argue that, because of the nature of a job, that job is only appropriate to people of a particular age group. For example, it may be an occupational requirement for someone taking up certain acting or modelling roles to be of a particular age.
  
  
• Other statutory provisions
  
  The EA also allows certain other exceptions, including national security, statutory authority or health and safety.

Specific exceptions

In addition to the general exceptions outlined above, the EA provides a bespoke regime for age discrimination exceptions.

• Service-related benefits
  
  Many employers link pay scales, career progression and benefits (for example, additional holiday, sick pay, notice periods or share options) to length of service. Using length of service in this way inherently runs the risk of being indirectly age discriminatory to younger workers who, as a group, will have had less of a chance to build up qualifying service. The EA recognises this risk and supports employers in using service-related benefits in certain scenarios. There is a general exception for service requirements of up to five years. Stricter rules apply where the benefit depends on service of more than five years, where the employer must show that it reasonably appears to it that the length of service requirement fulfils a business need (such as encouraging loyalty or motivation, or rewarding experience). This is a less stringent requirement than showing objective justification, but will still need evidence, applied to the particular situation.
  
  
• Redundancy pay
  
  Statutory redundancy pay is inherently age discriminatory as it is calculated by reference to the employee's age and length of service, but is permitted as being justified. Employers who want to offer enhanced redundancy pay are protected from age discrimination by virtue of the EA, but only if their payment scheme closely reflects the statutory scheme, bumped up in certain permitted ways. Where an employer has an enhanced redundancy scheme which strays outside these permitted exceptions, the scheme will not automatically be exempt, but it will be open to the employer to argue that the scheme can be objectively justified. This engages the usual balancing act, balancing the needs of the business against the discriminatory effects on the employees who will not be favoured by the scheme.
  
  
• Other statutory specific exemptions
  
  The EA also allows for other specific age exceptions, which include exemptions for certain insurance benefits, the national minimum wage exemption and for provision of childcare facilities.

Conclusion

Now is a good time for employers to focus on strengthening age inclusion and ensuring the resilience of their workforce in volatile times. The EA has several provisions which allow the employer to do certain things which could otherwise run the risk of being age discrimination against younger or older workers. These provisions can be harnessed by employers in developing a bespoke and evidence-based approach to age in their workforce. Employers would be well advised to collect and analyse data on the age profile of their workforce, and to audit and stress test existing policies, procedures and documents.

If you would like any help or advice on any of the issues raised in this article, please reach out to a member of our team who would be happy to assist you