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Case law: Employer changing terms of employment to detriment of older employees can be indirect age discrimination

An employer's changes to employees' terms and conditions that disadvantaged older employees was a provision, criterion or practice that could amount to indirect age discrimination.

Legal Alert

This update was published in Legal Alert - March 2015

Legal Alert is a monthly checklist from Atom Content Marketing highlighting new and pending laws, regulations, codes of practice and rulings that could have an impact on your business.

An employer in financial trouble offered employees a choice between accepting new terms of employment or being dismissed. The new terms put older employees at a disadvantage compared to younger colleagues, and they claimed indirect age discrimination.

There is indirect age discrimination if an employer operates a provision criterion or practice (PCP) which particularly disadvantages people of a particular age, but it can be justified if it is a 'proportionate means of achieving a legitimate aim'.

The Employment Appeal Tribunal ruled that a requirement to accept new terms was a PCP, but also ruled that it was a proportionate means of achieving a legitimate aim. It said the Employment Tribunal (ET) had carried out a critical evaluation of whether the PCP was objectively justified. The ET:

  • Had properly identified the employer's legitimate aim of reducing staff costs to ensure its future viability and to have in place market competitive, non-discriminatory terms and conditions.
  • Was aware of the effects of the PCP on the employees and balanced its needs against the effect of the changes on the employees.
  • Was aware of the alternatives proposed by the employees but was entitled to conclude those alternatives would not enable it to achieve its legitimate aim.

Operative date

  • Now

Recommendations

  • Employers changing employees' terms and conditions that disadvantage older employees are operating a provision, criterion or practice that can amount to indirect age discrimination and must justify it as a proportionate means of achieving a legitimate aim for it to be lawful.
Case ref: Case ref: Braithwaite & Ors v HCL Insurance BPO Services Ltd; Edie & Ors v HCL Insurance BPO Services Ltd UKEAT/0152/14/DM; UKEAT/0153/14/DM

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