Court of Appeal upholds landmark ruling on age discrimination
against Rolls Royce
14th May 2009
Unite the union, Britain’s biggest union, has today (14 May
2009) succeeded in securing a landmark judgment from the Court of
Appeal against Rolls Royce in one of the first cases on age
discrimination to be considered by the higher courts.
The Court of Appeal handed down its landmark judgment upholding
Unite’s resistance to an appeal by Rolls Royce against the decision
of the High Court which declared that the use of length of service
as one of a number of redundancy selection criteria was not age
discrimination.
For many years Rolls Royce operated a redundancy selection
procedure in agreement with Unite, the recognised union at the
company, which included length of service as one of six criteria
with one point awarded for each year of service. Despite
objections by Unite, Rolls Royce made an application to the High
Court seeking a declaration that the use of length of service as
one of the redundancy selection criteria discriminated against
younger members of the workforce who had less opportunity to accrue
length of service and was therefore unlawful under the age
regulations.
Rolls Royce’s application was disputed by Unite through its
solicitors Thompsons on the basis that length of service was an
objective and generally accurate measure of the loyalty and
expertise of employees. Unite further asserted that the older
and longer serving members of the workforce required a degree of
additional protection in a redundancy selection exercise since they
were likely to find it more difficult to secure alternative
employment if made redundant. Finally, Unite pointed out that
the collectively agreed criteria, including length of service, had
the jointly agreed objectives of the achievement of redundancies in
a fair, transparent and peaceable manner.
The High Court rejected Rolls Royce’s application in October
2008 and Rolls Royce appealed to the Court of Appeal. The Court of
Appeal's rejection of Rolls Royce’s appeal makes it clear that it
is lawful for employers to use length of service as one of a number
of criteria when selecting employees for redundancy.
Unite's joint general secretary, Derek Simpson, said: "We are
delighted with this decision. The ruling sets a precedent, where
other factors are equal, for protecting older workers from the
effects of redundancy. It has always been clear to Unite that
loyalty seen in length of service should be recognised when an
employer takes the drastic step of making redundancy
dismissals."
"We look forward to using this decision to help defend our
members’ rights in many other companies as well as Rolls
Royce."
Paul Evans of Thompsons Solicitors commented: “In the current
economic climate this is a timely judgment from the Court of
Appeal. Employers should take note and realise that they should not
seek to renegotiate or go back on longstanding agreements with
trade unions about how redundancies should be dealt with.”
ENDS
Press enquiries: Ciaran Naidoo, Unite Press Office 07768
931 315/020 7420 8931 or Stephanie Lennon, Thompsons
Solicitors 0121 212 6812
Notes to editors
The High Court’s Decision
The High Court, Sir Thomas Morison (former President of the
Employment Appeal Tribunal) presiding, rejected Rolls Royce’s
application.
The High Court found, in summary, that:
- The award of points for length of service was a “benefit” to
employees such that the less onerous “justification” test under
Regulation 32 applied.
- That the length of service criterion fulfilled a “business
need” of Rolls Royce in rewarding and encouraging loyalty and
experience of its workforce and in achieving redundancies in a
fair, transparent and peaceable manner.
- That, even if the more demanding test of justification in
Regulation 3 had applied, the length of service criterion would
still have satisfied that test in that it was a “proportionate
means of achieving a legitimate aim.” The Judgment stated:
“The criterion of length of service respects the loyalty and
experience of the older workforce and protects the older employees
from being put onto the labour market at a time when they are
particularly likely to find employment hard to find.”
The Court of Appeal’s Decision
Rolls Royce appealed against all aspects of the High Court’s
decision.
The Court first delivered a lengthy judgment on the
appropriateness of Rolls Royce seeking a declaration that its
procedures were unlawful before the redundancy exercise had been
carried out. The Court decided, with some considerable
hesitation, that it was appropriate given that the point in issue
between the parties involved the “construction and interpretation
of material emanating from Parliament … deriving from the European
Directive on Age Discrimination” and, as such, was a “matter of
public importance … likely to affect a large number of people both
employed by the company and beyond” (Judgment, paragraphs 54 to
56).
Having determined that Rolls Royce were entitled to seek the
declaration, the Court then went on to consider the substantive
points raised by Rolls Royce in support of its assertion that the
length of service criterion did not constitute a “benefit” to
employees and that it was unlawful under the Age Regulations.
Unite maintained its resistance to both assertions (both having
been rejected by the High Court).
The Court of Appeal dismissed Rolls Royce’s appeal and upheld
the submissions made by Unite on behalf of the workforce.
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