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Employment Law Update

Welcome to your first Employment Law Update for the year. This issue we look at: leading age discrimination cases of the moment; the increased compensation limits for unfair dismissal and redundancy claims and; the new code for Disciplinary and Grievance Procedures.

Age discrimination, compulsory retirement and legitimate aims

lawAccording to the Age Regulations, the retirement age exclusion does not apply to partnerships and office holders. In a recent case, an Employment Tribunal held that a law firm directly discriminated against one of its partners by requiring him to retire at the age of 65. However, the tribunal accepted that the compulsory retirement had legitimate aims, some of which were:

  • to ensure that junior solicitors have the opportunity of partnership when appropriate;
  • to help the planning of the partnership and workforce across individual departments by having a pragmatic long term expectation as to when vacancies will arise.

The EAT dismissed all grounds apart from one, where the firm presented reasoning that performance tailed off at 65. This statement was not supported by any evidence and also involved stereotyping.

In a similar case, an Employment Tribunal held that the compulsory retirement of an office holder was not justified and therefore resulted to unlawful age discrimination. In comparison to the case above, the tribunal refused the justification that compulsory retirement at 65 was required to allow for the creation of new vacancies for younger employees to gain experience.

Both cases show how each decision is based on facts around the particular circumstances of each case, and that neither decision is binding on other Employment Tribunals.

Compensation limits for unfair dismissal and redundancy to increase

The maximum level of compensation for unfair dismissal and redundancy cases is set to increase from 1 February 2009. The new rate increase will only be applicable for dismissals falling on or after this date. The key changes are as follows:

  • A week’s pay will be capped at £350 (previously £330) when working out statutory redundancy payments, or basic awards in cases of unfair dismissal;
  • The maximum compensatory award at the Employment Tribunal will be £66,200 (previously £63,000);
  • The maximum statutory redundancy payment will be £10,500 (previously £9,900). Please note: employers may enhance this payment if required.

And finally... ACAS publishes new code on Disciplinary and Grievance Procedures

ACAS has published its revised Code of Practice on Disciplinary and Grievance Procedures to help employers deal with arising issues in a fair and consistent manner. The code should come into effect on 6th April 2009 and will replace the previous current 2004 code.

The code encourages the use of alternative dispute resolution methods, and recognises that for many cases, turning to the tribunal system may not the most appropriate way to resolve workplaces disputes.

We advise that all employees should assess their disciplinary and grievance policies between now and March 2009, and then train the relevant managers using the new ACAS code.

Ceridian can help you keep compliant!

  • 1st January 2009
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