The Isle of Man Equality Act is making its passage through Tynwald and it is estimated that it will receive Royal Assent by Summer 2017. The Act is a ground breaking piece of legislation for the Isle of Man and it is our view that the prohibition of age discrimination as a matter of law will represent a "new era" for the Island, bringing with it new opportunities and challenges for employers. This article is the first of nine that DQ will publish over the forthcoming months, aimed at highlighting the protected characteristics that will soon form part of the Island's equality law.
1. Compulsory Retirement
At present the Isle of Man does not recognise in law the concept of age discrimination. This allows an Island employer to set whatever compulsory normal retirement age it wishes for its employees, provided that it is the same for men and women. The practical effect of this is that once an employee has reached the normal retirement age (or the age of 65) the employee loses the right to claim unfair dismissal or a redundancy payment. There are some exceptions to this, but they are limited.
Under the Equality Act the compulsory retirement of a person on grounds of age will be unlawful unless justified as being a proportionate means of achieving a legitimate aim. What this means will be dependent on the individual facts and may include reasons such as ensuring the availability of career progression opportunities and/or a spread of skills and experience, or (in the case of John McCririck) attracting a wider audience to horse racing!
The practical effect of this for Island employers will be employees staying in employment past the age of 65 years. Indeed, Island-based investor Jim Mellon has been quoted in the local media as saying we will now have to work until we are 80! Whether this is true or not, best practice should be encouraged now to avoid costly litigation in the future. To that end, the Island is fortunate in being able to learn from the mistakes of employers "across". The Equality Act largely mirrors the UK legislation, deliberately in part so that the Island's courts and tribunals can benefit from the guidance issued. There have been a number of cautionary tales emanating from the Employment Tribunal (England and Wales) to which Island employers should now take heed.
2. £63,390.95 awarded to "Gramps"
The English employment tribunal case of Dove v Brown & Newirth Limited is a recent example of a workplace nickname - not designed or intended to be disrespectful or hurtful – that resulted in a tribunal finding for the recipient (here, Mr Dove) as regards his claim for age discrimination. The tribunal considered that the practice had resulted in real detriment to Mr Dove; the fact that it was "banter" and Mr Dove on occasion referred to himself by the nickname did not matter. The tribunal considered that Mr Dove's dismissal following the transfer of his accounts to another salesperson, in circumstances where clients had allegedly communicated a desire for "a fresh approach" where Mr Dove was "old fashioned" and "long in the tooth", was influenced by discrimination and thus unfair. It didn't matter that age discrimination was not the main or principle reason for the less favourable treatment; the dismissal was nevertheless found to be tainted by such discrimination and thus warranting the level of compensation awarded.
3. Direct discrimination- case law snap shot
The case of Mr Dove demonstrates the financial risk to employers in failing to address employee discrimination in the workplace. You might consider that to call someone "Gramps" is obviously discriminatory, however not all examples will be so clear cut. The following instances from UK case law demonstrate what could give rise to litigation or adverse press against your business on grounds of age discrimination:
- Dismissing a newly recruited 18 year old supposedly on capability grounds but which the employment tribunal considered was instead motivated by stereotypical assumptions on the grounds of age.
- Dismissal for being too old where the employer had said he was going to replace his 63 year old receptionist with "a young, fit blonde".
- Not offering voluntary redundancy to employees over 50 on grounds of the cost of enhanced early retirement benefits for those over 50 was held to amount to less favourable treatment on grounds of age.
The concept of age discrimination and the future abolition of the compulsory default retirement age under the Equality Act is indicative of the evolution of Island employment law and employers need to be ready. Businesses can start now by ensuring the culture of the organisation is inclusive; this can be assisted by the introduction of an equality policy along with workplace training. Such measures will ensure employees know what the employer considers unacceptable behaviour and the consequences of this. Most importantly, when asked whether it is ok to call a colleague a "silver fox" they will appreciate that such terms of apparent endearment, spoken innocently, could nevertheless be considered hurtful and/or insulting and may be deemed discriminatory to the grey haired subject, be that on grounds of age, or indeed, sexual harassment.
If you want to discuss this article or obtain advice on how DQ can help your business prepare for the implementation of the Equality Act please contact Leanne McKeown, head of the firm's specialist employment team. Leanne has considerable professional experience advising in all aspects of employment equality law, such experience acquired both on Island and during her time practicing as a solicitor in Northern Ireland.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.