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Interesting Decision On Extension Of Employment Post-mandatory Retirement Age

Facts: The Complainant was employed as Operations Manager from 1982 to 17th June 2019 and was paid €54,451.92. The Respondent has a mandatory retirement age of 65 years. The Complainant was due to turn 65 years on 14th June 2017. He requested the HR that he wished to remain in employment and received a written contract for that year from the date of his retirement. The following year, he requested to continue employment, which was agreed by the Respondent and the Complainant received a written contract to continue employment for another year. On 18th April 2019, the Complainant was advised that the CEO of the Respondent Company would not be extending the Complainant’s employment further and that his employment would end on 17th June 2019.

The Respondent offered some staff training job to the Complainant on consultancy basis after the employment was terminated.

The Complainant claimed that he was discriminated on the ground of age.

Findings: The Adjudication Officer found that a mandatory retirement age was not unlawful under Irish Law once it could be objectively justified. He noted that while there was a mandatory retirement age in place, the Complainant was permitted to continue to work for two years beyond the mandatory retirement age on two fixed term contracts. The Complainant was not advised of the implications of being on fixed term contracts. 

In examining the Respondent’s communication to the Complainant on 28th May 2019 in relation to the non-renewal of the fixed-term contract, the Adjudication Officer noted that the Respondent did not clearly set out how intergenerational fairness, health and safety of staff, internal recruitment and promotion opportunities, succession planning or preservation of personal and professional dignity impacted on the decision not to renew his contract on this occasion. It was fatal for the Respondent that it did not rely on any of the above concerns or justifications for non-renewal during the previous extensions. Hence, the Adjudication Officer concluded that the Complainant was discriminated against on the grounds of age. The Adjudication Officer opined that the Respondent should consider the impact on the employee, both financially and otherwise and the impact on the organisation must be balanced against that. The Adjudication Officer awarded the Complainant compensation equivalent to just less than six months of his remuneration.

Takeaway for the Employers: This decision important for employers who have a mandatory retirement age and consider extending the employment of an employee post retirement age on fixed term contract. Employers should explain the justification for the mandatory retirement age and the application of such justifications on deciding the length of a fixed term contract. Employers should also ensure that the employee understands the implication of being on a fixed term contract.

Authors – Anne O’Connell & Chaitra Girish Mallya

28th May 2020

Link: https://www.workplacerelations.ie/en/cases/2020/april/adj-00023458.html

Anne O’Connell

Solicitors

Fitzwilliam Hall

Fitzwilliam Place

Dublin 2

www.aocsolicitors.ie

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