Employee excluded from redundancy package wins age discrimination case

Laura Banks

22 December 2017

Where an employer directly or indirectly discriminates against an employee on the grounds of age, this will be unlawful unless the employer can objectively justify the discrimination.

A recent case taken by Bernard Barlow against Gallaher Ltd, the Tribunal had to decide if refusing to offer a 66 year old man the same redundancy package as those under 65, was lawful. They held it was not. 

Mr Barlow had been working in the company for 27 years when they announced they were closing and as a loyal and dedicated employee he said felt hurt and upset to discover that he would not be eligible for the enhanced redundancy package solely on the basis of his age. 

The Tribunal considered to what extent it was justified for Gallaher Ltd to act as it did. Gallaher Ltd argued it was necessary to ensure finite resources were spread equally across the work force and that they needed to “cushion” younger employees and prevent a culture where older workers remained in work longer to secure a “windfall”. The Tribunal rejected these arguments finding that there was insufficient evidence to support them. Further they held that Gallaher Ltd could not prove that they had seriously considered other ways to achieve their aims.  

The Tribunal found that Mr Barlow had suffered both direct and indirect discrimination and they will reconvene to consider the amount of compensation that should be paid.  What is particularly interesting about this case is that the Tribunal found that the companies enhanced redundancy scheme which had been set up in 2009, was not amended in 2011 to reflect a change in the default retirement age. No equality audit had been carried out to assess the discriminatory impact of the scheme. Had the company taken these steps they would not be faced with claims for discrimination which are extremely costly and damaging to the reputation of any business. 

Furthermore, the Tribunal noted that during negotiations, the interests of over 65 year old persons were not advanced by either the recognised trade union or management. 

The case which was supported by the Equality Commission highlights the importance of up to date legal advice on employment law issues for all parties. For employers, it illustrates the need to receive legal advice on the review of policies and procedures regularly to ensure they are compliant with the ever changing law. For employees it shows that it is important to get your own independent legal advice on your specific circumstances.

Age discrimination in particular is becoming increasingly relevant as more people choose to work beyond 65.  Any employers or employees concerned about potential discrimination at work issues should contact Laura Banks of Francis Hanna & Co on lbanks@fhanna.co.uk for a no obligation discussion. Claimants should be advised that time limits are strict and any claim for discrimination must normally brought within 3 months of the act complained of. Advice should be sought without delay.