Mandatory Retirement - Was 65 an Appropriate Age?

In the long-running case of Seldon v Clarkson, Wright and Jakes, the Employment Appeal Tribunal (EAT) has upheld the decision of the Employment Tribunal (ET) that the inclusion in a law firm’s partnership agreement of a clause that required partners to retire at 65 was justified in the circumstances.

Leslie Seldon, a former senior partner of the firm, retired in 2006, when there was still a default retirement age of 65. He claimed that the provision in the partnership agreement, which had been agreed by all the partners, constituted direct discrimination under the Employment Equality (Age) Regulations 2006 – now replaced by the Equality Act 2010.

He pursued his case as far as the Supreme Court, which held that the test for justifying discrimination on the ground of age is narrower for direct discrimination than for indirect discrimination. To defeat a claim of direct discrimination, the employer must show that the treatment stems from an aim that can be objectively and reasonably justified as pursuing a legitimate social policy derived from the EU Equal Treatment Directive.

The Supreme Court dismissed Mr Seldon's appeal. Whilst his retirement at age 65 was, on the face of it, direct discrimination, the firm’s reason for having in place a mandatory retirement age for all partners was capable of justification. The ET had identified three objectives – staff retention, workforce planning and limiting the need to expel partners by way of performance management – which met the test of being based on legitimate social policy aims.

The case was remitted back to the ET, however, to consider whether the choice of 65 as the specific age at which partners were required to retire was a proportionate means of achieving the aims in this case.

The ET found that the retirement age of 65 was fair and proportionate in the circumstances.

Mr Seldon's appeal against that decision relied on the principle that where there is a provision which would achieve the legitimate aim with less discriminatory impact than the measure used, the measure cannot be justified. He contended that the ET had erred in excluding the question of justifiability of the particular age chosen by Clarkson, Wright and Jakes for the retirement of partners from the firm. He claimed that 'either 68 or 70 would be an age which would have served just as well'.

The EAT held that the issue for the ET in such cases is to determine the balance between the discriminatory effect of selecting a particular retirement age (which will include looking at its effect not only on the claimant but also on the claimant's associates) and its success in achieving the aim held to be legitimate. That exercise will not necessarily show that a particular point can be identified as any more or less appropriate than another particular point.

In the EAT's view, the ET was entitled to conclude that a retirement age of 65 was fair and proportionate in the circumstances.

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