Taylor v Secretary Of State For Scotland [1999] Court of Session IRLR 362
Whilst legislation prohibiting age discrimination is yet to be introduced in the UK, the recent decision of the Court of Session (Scotland's Court of Appeal) in Taylor v Secretary of State for Scotland has created a window of opportunity for combating age discrimination using collective agreements and employer policies, which may then be enforced through the Courts.
Mr Taylor was employed as a Prison Officer by the Scottish Prison Service. When he joined the Service, retirement arrangements permitted him to retire at age fifty-five. By agreement, he could continue to work until age sixty, subject to a right to terminate by giving three months' notice by either side.
In 1991, Mr Taylor reached age fifty-five. His employers agreed that he could continue in his job beyond the age of fifty-five but that retention beyond the minimum retirement age "is at the Department's discretion and subject to regular review. Retirement may therefore be effected at any time and is subject to three months' notice on either side".
In 1992, the employers issued a circular setting out an equal opportunities policy, undertaking "to offer opportunities on an equal basis to all staff regardless of gender, race, religion, sexual preference, disability or age".
In 1994, the Scottish Prison Service introduced changes to its retirement policy. All employees over age fifty-five, including Mr Taylor, were given six months' notice of dismissal. The purpose was to save money and get a younger and differently skilled workforce.
Mr Taylor claimed that this amounted to discrimination on grounds of age, in breach of the equal opportunities provision which he claimed formed part of his contract of employment.
Two issues arose:
(a) whether the management circular of 1992 provided a legally enforceable contractual right not to be discriminated against on grounds of age; and
(b) if so, was a change in the employer's retirement age policy, which led to his dismissal, age discrimination and therefore in breach of contract? The Employment Tribunal supported Mr Taylor's claim. The equal opportunities policy was "incorporated into the Applicant's contract of employment". The Tribunal went on to find the policy specifically contained a provision that employees would not be discriminated against because of their age, that the reason for the change in the retirement policy was principally a question of age and therefore contrary to the equal opportunities policy.
There had been a breach of contract.
The Employment Appeal Tribunal (Scotland) upheld the employment Tribunal's finding that the terms of the equal opportunities policy were incorporated into the employee's contract of employment. However, the EAT allowed the employer's appeal on the grounds that the dismissal of Mr Taylor after he reached the normal retirement age of fifty-five was not discrimination on grounds of his age.
On appeal to the Court of Session, it was not disputed that the equal opportunities policy was part of the contract of employment. However, the Court of Session also held that the decision to retire Mr Taylor was not age discrimination in breach of his contract of employment. The Court noted that any retirement policy, if put into operation, would almost inevitably result in the retiring persons being replaced by younger persons.
Mr Taylor had a contractual right not to be discriminated against on grounds of age, before the minimum retirement age of 55. But, the contract gave management a wide discretion to decide on retirement ages between 55 and 60 and could include age considerations.
Whilst it is difficult to accept that the use by an employer of a retirement policy to remove a section of employees for the purpose of introducing a newer and younger workforce does not amount to age discrimination, the case does represent a significant advancement in creating a remedy for those who are discriminated against on the basis of their age. The finding that equal opportunities policies may be incorporated as part of a contract of employment, allows an employee to sue for breach of contract.
This case sends an important message to employers implementing equal opportunities policies that they may be held accountable for the assurances made in those policies, in the event that those assurances are not fulfilled.