Pre-signals of an ever-aging workforce

By Dr. Bernd Borgmann, LL.M., and Tom Stiebert

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Age limits seem to be a recurring topic in (European) employment Law. For many years, the European Court of Justice has ruled regularly on cases directly or indirectly connected to age thresholds – often in (supposedly) very similar situations. For example, an age limit of 60 years was declared inadmissible, while an age limit of 65 years was recently confirmed as balanced (ECJ from 5 July 2017 – docket number C-190/16 (Fries)). This current verdict is an occasion to take a closer look at the problems posed by age limits, which have a direct and significant effect on companies’ workforce policies.

Why age limits are an important topic

Age limits come into play in different ways: On the one hand, as a maximum age limit for the commencement of a particular career or even for starting work in the occupation at all; on the other hand – even more relevant – as a fixed retirement age at which the employment relationship shall automatically terminate. A third similar case is the provision of benefits (for example additional days of leave) from or to a certain age.

This connection to the characteristic “age” is not rare in the practical application of HR policies in all companies worldwide. In contrast to other discriminatory features, every employee is affected – it is not just about discrimination against young or old workers. Special care must therefore be exercised in applying these rules in general terms or policies to avoid accidental discrimination. A recap of the ECJ’s difficult legal practice may therefore be useful.

Overview of most important ECJ ­decisions

Looking at the numerous ECJ rulings on this topic, it becomes clear that the decisive facts were very similar in most cases. Curiously, however, the results and conclusions of the judges are very different.

The reason for the multitude of judgments is that these age limits constitute (direct) unequal treatment on grounds of age under European law (see Article 1 and 2 Council Directive 2000/78/EC). This difference in treatment is only permitted if it is justified (Article 6 Council Directive 2000/78/EC). This is only the case, “if, within the context of national law, they are objectively and reasonably justified by a legitimate aim, […], and if the means of achieving that aim are appropriate and necessary.”

This presents the HR practitioner with a basket of issues which need to be addressed. The legislator (or the employer, which adopts such a regulation) must take into account precisely the objectives pursued by a regulation and whether these objectives cannot be pursued in any other form that would avoid direct discrimination on reasons of age. This explains why some age limits are permissible, while others are inadmissible. Therefore, the concrete factual aspect is always decisive – one age limit can be justified in one case, whereas the same limit is not permissible in another constellation.

The most important decisions of recent years are:

  • ECJ from 12 October 2010 – docket number C-45/09 (Rosenbladt) – Termination at statutory pension age is permitted
  • ECJ from 5 July 2012 – docket number C-141/11 (Hörnfeldt) – Termination at statutory pension age is permitted and regardless of the pension level
  • ECJ from 18 November 2010 – docket number C-250/09 and C-268/09 (Georgiev) – Statutory age limit of 68 years for professors is permissible in the specific case
  • ECJ from 13 September 2011 – docket number C-447/09 (Prigge) – Age limit of 60 years in a collective agreement for pilots is inadmissible in the specific case
  • ECJ from 12 January 2010 – docket number  C-341/08 (Petersen) – Statutory age limit of 68 years for contract dentists is inadmissible in the specific case
  • ECJ from 6 November 2012 – docket number C-286/12 (Commission / Hongrie) – Statutory age limit of 62 years is inadmissible for judges, prosecutors and notaries in the specific case
  • ECJ from 5 July 2017 – docket number C-190/16 (Fries) – Age limit of 65 years for pilots is permitted in the specific case

Backround of the decisions:
How to permit a discrimination

In order to act in a more legal manner, these decisions of the ECJ must be precisely understood. The criteria examined by the ECJ are always the same. Guidelines for practical use can therefore be extracted as follows:

Legitimate aim

First, it is important that there is a legitimate aim which the legislature or the individual employer pursues. In the latest case (docket number C-190/16), the goal was “establishing and maintaining a high uniform level of civil aviation safety.” A hopeless connection with age is always inadmissible. If, therefore, an age limit shall be upheld or introduced, the first step is always to clarify the purpose.

The courts are quite generous in accepting a legitimate aim, in particular, if the values at hand are itself significant and form part of the general good. It is only important to show a legitimate aim, the options of potentially legitimating purposes are not limited. Legitimate aims are, in principle, safety-relevant aspects or the recognition of a longer need for the recovery of older people, provided these arguments can be proven and are not just general beliefs without factual truth. The directive deliberately goes very far here and recognizes the following (non-final objectives): “legitimate employment policy, labor market and vocational training objectives.” (Article 6 (1) Council Directive 2000/78/EC). Therefore, age relevant provisions rarely fail at this point.

Appropriate and necessary means of achieving the aim

The steps next on the checklist are far more critical – the aim has to be appro­priate as well as necessary. Appropriateness exists when the goal can actually be achieved. Necessity means that a rule is permitted if no milder means exist. The second point is extremely problematic, since it is difficult to provide evidence of why a specific age must be stipulated (apart from the age of retirement). The ECJ is helping here with a construction which simplifies practical handling.

Two points therefore are relevant: On the one hand, the ECJ often checks at this point whether the regulation is consistently enforced. In this case, the legislator must not act in a contradictory manner (so-called coherence). An aim is only recognized as permissible when it is pursued broadly and not only in individual regulations. This point also has to be checked carefully during practical work. It is therefore extremely important to keep all regulations in mind and to check them for their compatibility.

On the other hand, the ECJ now makes it clear that rigid age limits (as in most cases) are also permissible. There is no need for a single case test or an exact medical proof of the limitations on the individual from the age of 65 onwards, otherwise an efficient and practicable age limit would not be conceivable. Here the age limit is “based on extensive professional debate and expertise; they are, as objective and reasonable references for decision makers, of particular relevance in assessing the proportionality of the provision of EU law at issue in the present case.” A single case test would also be impractical. The ECJ here refers in large part to the detailed arguments of the Advocate General Bobek in his opinion from 21. March 2017 (recitals 60 – 62). The German Federal Labor Court, on the other hand, has a tendency to differ from one individual case to another, adopting a search for the individual right and just solution. In doing so, it requires fitting and specific evidence that there is indeed an increased risk or protection or need for recreation at a higher age. Such proof is practically impossible and cause too much protection against discrimination. This makes the ECJ’s jurisdiction more advantageous.

On the whole, the judgments show that caution should be exercised in all cases in which regulations or provisions are connected to age. It is always advisable to collect evidence from valid sources about why a certain age is given as a limit in order to avoid invalidity of the regulations.

Instructions for practical use

It is important to be aware of possible discrimination, direct or even indirect, related to age in any HR policies or laws. Violations and the consequent banning of such regulations can only be prevented if the differencing age provisions are recognized and justified at least with regard to ECJ rules.

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