Length of Service and Redundancy Selection

Length of service and redundancy selection

Mark Robinson, Employment Partner at solicitors Hodge Halsall LLP, comments on the recent Rolls-Royce case and its impact on selection criteria for redundancy.

"The introduction of the Employment Equality (Age) Regulations 2006 made it unlawful to discriminate on grounds of age but allows age discrimination if it can be justified where it is a "proportionate means of achieving a legitimate aim". Courts therefore have to balance the discriminatory impact of the act and the employer’s aim.

In the recent case of Rolls-Royce v Unite, the Court of Appeal was asked to consider whether using length of service in a redundancy selection matrix was lawful or whether it was a breach of the age discrimination regulations. A collective agreement had been entered into between Rolls-Royce and Unite in relation to redundancy which used five criteria with points also awarded for each year of continuous service. Employees with the least points were selected for redundancy.

Following the introduction of the regulations Rolls-Royce sought a declaration from the Court that the use of length of service as one of its redundancy selection criteria discriminated against younger members of the workforce and was therefore unlawful. The Court decided that whilst length of service was discriminatory viewed objectively it was also a proportionate means of achieving a legitimate aim. That legitimate aim was the reward of loyalty and operating an employment policy which enabled redundancies to be carried out "peaceably" and in a manner that could be seen to be fair. Proportionality was established by the fact that the length of service criterion was only one of a number of criteria used.

The effect of the judgment is that using length of service as one of several criteria in a redundancy selection process will not be unlawful age discrimination. Using length of service on its own (last in first out) will almost certainly constitute age discrimination. Employees will also still have the ability to challenge the utilization of their selection for redundancy on grounds that include length of service and each case will have to be considered on its individual facts in order to determine whether or not any such redundancy was lawful."

 

Further details can be obtained from Mark Robinson at markrobinson@hhlegal.co.uk or on 01704 531991.