Yes, a shorter redundancy process can be considered age discrimination according to the Employment Appeal Tribunal (EAT) in Cook v Gentoo Group Ltd, who overturned the original Employment Tribunal decision.
In his latest article, Chris Dobbs looks at the importance of carrying out a full and fair redundancy procedure.
Cook v Gentoo Group Ltd – Case Background
Mr Cook was approaching his 55th birthday when he was made redundant by Gentoo. He was in the company pension scheme, the rules of which entitled members to an immediate payment into their pension, without reduction, if they were made redundant after they had reached 55 years of age.
This would have resulted in Mr Cook receiving a substantial extra contribution, about £80,000, into his pension from the company.
What were the claims?
Mr Cook brought claims for unfair dismissal and age discrimination, alleging that the company had deliberately curtailed the redundancy procedure so they could dismiss him before turning 55.
The Employment Tribunal agreed that Mr Cook had been unfairly dismissed due to the company not complying with the obligation to look for suitable alternative employment and for rushing the process.
However, they did not agree he had been directly discriminated because of his age. Mr Cook appealed the latter decision to the EAT.
What did the EAT rule?
The EAT decided that the employment tribunal had erred in their decision and Mr Cook’s appeal succeeded. They held that the tribunal had not found in favour of Mr Cook, holding that the tribunal had not considered whether or not the treatment of Mr Cook was a proportionate means of achieving a legitimate aim.
Direct age discrimination, unlike the other protected grounds under the Equality Act 2010, can be justified if an employer can demonstrate they had a legitimate aim to which the less favourable treatment was a proportionate means of achieving it. An example in age discrimination would be to provide for fair and reasonable succession planning.
The EAT sent the case back to the tribunal to ask them to set out what the company’s legitimate aim was in avoiding paying Mr Cook the additional pension contribution and whether dismissing him early by curtailing the redundancy process was a proportionate means of achieving any such legitimate aim.
An Employment Solicitor’s View
Chris Dobbs said: “This case serves as a warning to employers to take note of the conditions of pension schemes when going through a redundancy procedure with employees close to the applicable retirement age and to ensure they carry out a full and fair procedure.
Any failure to do so can end up being an expensive mistake.”
Related: How to make redundancies, a guide for employers
Redundancy Training
At Frettens, our specialist Employment Team offer a collection of tailored Employment & HR Training Courses; one of which being a course on handling a redundancy process.
These courses have been designed to educate & strengthen you and your staff’s knowledge of such issues.
If you’re interested in any of these courses, you can find our more here
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