Redundancy offer to over-60s breached Age Regulations

A redundancy package offering different terms to employees based on their age has been ruled unlawful.

The issue arose after two civil servants were offered a lower redundancy package than their younger colleagues.

The employees were both over 60 and entitled to draw a full pension. On this basis, their employers offered them a redundancy package of just 6 months’ salary, whereas their younger counterparts were offered 21 months’.

The two employees took the case to the Employment Tribunal, claiming that their age should be irrelevant to the redundancy entitlement.

However, the tribunal ruled that they did not have the same need for a “”cushion”” as a younger employee because they were entitled to an immediate full pension.

The employees took the case to the Employment Appeal Tribunal, which overturned the decision.  

It pointed out that age was a protected characteristic under the Equality Act 2010.

From a practical point of view, it could be argued that because of their access to a full pension, the employees were less in need of the money than their younger colleagues.

However, that argument could not be considered when valuing the redundancy packages because it was not relevant within the terms of the age regulations.

The case was sent back to the Employment Tribunal for a fresh consideration.

Please contact Robert Bedford if you would like information regarding redundancies, or any other aspect of employment law.