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Education briefing - Employer Justified Retirement Ages in HE – lessons from Pitcher v University of Oxford

  • United Kingdom
  • Education - Briefings

20-06-2019

A recent employment tribunal decision has upheld the University of Oxford’s retirement age for academic staff. The tribunal dismissed a claim by an academic that his forced retirement at the age of 67, and the rejection of his application for continued employment, was unlawful age discrimination and unfair dismissal. In Pitcher v Chancellor, Masters and Scholars of the University of Oxford & Other, the tribunal accepted Oxford’s arguments that its retirement policy was objectively justified, as a means of creating vacancies which could be used to promote greater diversity in terms of gender and ethnicity.

Since the vast majority of the UK’s universities do not use a compulsory retirement age, this decision is likely to spark interest in the sector about the scope for reintroducing one. In this briefing, we summarise the decision and offer some initial thoughts on the extent to which the tribunal’s reasoning could be relied on by other institutions.

Legal framework and background

Age discrimination legislation in the UK means that forcing employees to retire when they reach a specified age will normally be unlawful direct age discrimination. However, and uniquely in UK discrimination law, direct age discrimination is lawful if the practice or treatment can be shown to be objectively justified. The employer must show that its treatment of the employee (eg a dismissal on the grounds of age) is a proportionate means of achieving a relevant legitimate aim. In this context, the standard objective justification test is modified – to justify direct age discrimination, the legitimate aim relied on by the employer must have a social policy dimension. UK and EU case law has identified two main categories of “social policy aims” – promoting inter-generational fairness (eg creating opportunities for younger staff to be employed or promoted) and preserving the dignity of older members of the workforce (for example, avoiding the need for performance management of older staff).

In 2011, when the UK’s statutory default retirement age of 65 was abolished, Oxford decided to retain a normal retirement age for its academic staff – an “Employer Justified Retirement Age” or “EJRA” of 67 (or more precisely, 30 September immediately prior to the individual’s 68th birthday). This EJRA was adopted after detailed consideration of equalities data and statistics, including the age, gender and ethnicity profile of the academic workforce. This equalities data, and the impact assessment it supported, showed that retirement was, by some way, the most significant cause of academics leaving the University (nearly 40% over the immediately preceding years). The vast majority of academics due to approach retirement age over the period 2011 to 2017 were male. Less senior age bands of academic staff were more diverse in terms of gender. In relation to ethnicity, the available data highlighted a clear pattern of greater diversity in younger age bands compared with older age bands, with the proportion of BAME staff falling with increasing age. The impact assessment concluded that compulsory retirement had been important to facilitate the turnover and diversification of University employees, particularly academic staff, and that removing a retirement age would slow the departure from the University of older less diverse groups of staff. Conversely, retirement would create the opportunity to increase staff diversity through new recruitment, with a positive impact on the proportion of women and BAME staff in the academic workforce.

The proposed EJRA was also the subject of extensive consultation across the University, including with its academic staff, its recognised unions and with its constituent Colleges (since Oxford’s academic staff are typically also employed by a College, under a joint employment arrangement). The Colleges undertook their own consultation in parallel, and adopted the same position as the University. The outcome of the analysis and consultation was a decision in October 2011 to adopt an EJRA of 67 for an initial period of 10 years, with an interim review to be conducted after 5 years. In terms of objective justification for the EJRA, the University relied on 7 legitimate aims - those relevant to the Pitcher decision are set out below.

Under the University’s retirement procedure, staff would be informed, two years in advance, of their formal retirement date and the process for requesting continued employment beyond that date. The procedure encouraged the member of staff to discuss, early and informally, with the University and their College, options which might support their continued employment (such as a variation in duties, hours or type of contract), so that these could inform consideration of any formal application. Formal applications for continued employment were to be made 18 months before the retirement date, with the applicant specifying the proposed working arrangements and the length of the extension requested. In addition, the procedure set out a list of considerations which might justify an exception to the general rule for retirement and against which a panel would determine requests. Applicants had to set out the rationale for their proposed extension, having regard to these factors.

Professor Pitcher was dismissed by the University and his College in September 2016, after his extension request was dismissed under the EJRA procedure as originally adopted in 2011. However, the employment tribunal also took into account, when assessing objective justification and proportionality, the steps taken by Oxford to review and modify the EJRA process over time.

In the first year of the EJRA, most requests for extensions had been granted, indicating that the scheme was not working as intended and that Panels might be applying the exception criteria too generously. This prompted the University to review the EJRA procedure and the application of the extension criteria. In a further development, an Appeal Panel (chaired by a retired appeal court judge) decided that the EJRA policy and extension provisions were not objectively justified and that the dismissal of the academic concerned was unfair and discriminatory. In response, a working group undertook a review and proposed changes to the EJRA, to amend the legitimate aims relied on and modify the extensions procedure, as well as a staged increase in the normal retirement age – to 68 in 2015 and 69 in 2022. An extensive five year review of the EJRA took place in 2015, leading to further changes.

The tribunal decision

Professor Pitcher claimed that his dismissal was unfair and amounted to unlawful age discrimination. To defend the age discrimination claim, Oxford had to establish that the EJRA was objectively justified – showing firstly that it was adopted to pursue one or more legitimate aims (with the required social policy dimension) and secondly that the EJRA and extension process were a proportionate means of achieving those aims.

At the employment tribunal hearing, Oxford relied on four of the seven legitimate aims set out in the 2011 EJRA scheme:

• promoting intergenerational fairness and maintaining opportunities for career progression for those at particular stages of a career, given the importance of having available opportunities for progression across the generations, in order, in particular, to refresh the academic research and other professional workforce and to enable them to maintain the University's position on the international stage;

• facilitating succession planning by maintaining predictable retirement dates, especially in relation to the collegiate University's joint appointment system, given the very long lead times for making academic and other senior professional appointments, particularly in a University of Oxford’s international standing;

• promoting equality and diversity, noting that recent recruits are more diverse than the composition of the existing workforce, especially amongst the older age groups of the existing workforce and those who have recently retired;

• minimising the impact on staff morale by using a predictable retirement date to manage the expected cuts in public funding by retiring staff at the EJRA.

The tribunal accepted that these were permissible legitimate aims, having regard to previous UK and EU case law on the objective justification of direct age discrimination.

The key legal battle ground in the case was the issue of proportionality – ie whether the means adopted by Oxford to pursue these legitimate aims were appropriate and reasonably necessary to achieve them, when balanced against their discriminatory effect. It is important to note that the issue for the tribunal was whether the EJRA scheme in general was proportionate, rather than its application to the claimant itself.

The starting point for the University’s successful case on proportionality was that the EJRA allowed it to create academic staff vacancies and that this was fundamental to its ability to advance the legitimate aims relied on. The relevant “means” adopted to pursue those aims were not just the EJRA of 67 years (at that time) but the EJRA extension procedure as a whole, which allowed those approaching retirement age to seek to make out a case for working beyond that age by establishing grounds for an exception to the EJRA. This extension process allowed for requests to be considered against specified factors, the right to a hearing and to an appeal if their application was rejected, as well as the possibility of an extension of employment (for a fixed period and possibly with a revised role) being agreed. The extension process therefore helped to mitigate the discriminatory effect of the retirement age by balancing the wishes of the individual approaching the EJRA with the needs of the University.

Proportionality was also established by the extensive consultation process undertaken before the EJRA was adopted in 2011 as well as the subsequent monitoring and review mechanisms implemented afterwards. These had led to changes in the expressed legitimate aims; the benchmarks against which extension requests were assessed; and the retirement age itself. The tribunal also appears to have taken into account that the continued use of the EJRA (as amended after the 5 year review) was agreed by Oxford’s Congregation in 2017, ie approved by the very academic staff group it would affect.

The tribunal upheld Oxford’s arguments on proportionality even though it was currently difficult for the University to provide significant evidence that the EJRA was, in practice, actually helping to progress the relevant legitimate aims. In relation to the aims of promoting inter-generational fairness and promoting diversity, the tribunal’s assessment appears to have been that the number of vacancies generated each year by compulsory retirement was small; that initially the University’s age and diversity profiles had “gone backwards” because many staff subject to the EJRA had been granted extensions of employment; and that it would in fact take many years for the actual impact of these measures in advancing the legitimate aim to become evident.

Comment

This is, of course, only an employment tribunal decision. Even if it is not appealed, the judgement refers to a separate employment tribunal claim (Ewart) being brought against Oxford by another academic dismissed under its EJRA procedure. In that case, the claimant appears to be seeking to undermine the University’s proportionality arguments by relying on workforce diversity, turnover and progression statistics from other Russell Group institutions which do not operate an EJRA - presumably to either challenge the diversity statistics relied on by Oxford or to demonstrate that other institutions can advance similar legitimate aims without needing to operate an ERJA. In the Pitcher case, the claimant made a late attempt to rely on this same statistical evidence but was prevented from doing so. It will be interesting to see whether the tribunal outcome in Ewart is consistent with that in Pitcher.

The Pitcher decision illustrates that it is possible for a university to objectively justify an EJRA. However, this does not necessarily mean that other institutions could do the same, by relying on the same legitimate aims and adopting the same, or similar, extension process.

One potentially limiting factor on the applicability of this decision to other institutions is the fact that Oxford does not operate a typical academic promotions process. Associate Professors (the main professorial grade) and full professors are appointed by applying to posts which become vacant or are newly created. This particular structure supports Oxford’s argument that, to achieve the legitimate aims it relied on, it needs to generate vacancies by forced retirement as well as natural turnover and voluntary retirement. Most UK institutions operate very different models under which academic staff can progress to more senior roles and grades by promotion on merit as well as by applying for more senior posts when these are advertised. These universities would need to use more nuanced arguments that creating vacancies by forced retirement is still a proportionate way of increasing diversity because it creates a greater number of opportunities for internal promotion or internal/external recruitment to vacant roles. However, the strength of that proportionality argument for compulsory retirement – in a context where diversity can also be advanced by promotion – would need to be very carefully evaluated.

The tribunal in Pitcher also appears to have taken into account the fact that under Oxford’s particular governance arrangements, the EJRA was ultimately endorsed by Oxford’s Congregation, its supreme governing body whose 4,500 members include the University’s academic staff, ie those directly affected by the EJRA. The Congregation could have (but did not) debated and overruled the Council’s decision to adopt the EJRA in 2011. In addition to this tacit acceptance of the EJRA framework which applied to Professor Pitcher, the Congregation subsequently voted in 2017 to maintain the EJRA following an internal appeal panel decision that it was discriminatory and separately voted to endorse the revisions to the EJRA following the five year review.

A further consideration is that institutions seeking to re-introduce a retirement age would be coming at this issue from the opposite direction to Oxford, which has always had a normal retirement age and was defending the continuation of this practice. The vast majority of the sector has been operating without a normal retirement age or EJRA for the best part of 10 years – only Oxford, Cambridge and St Andrews use an EJRA. The evidence base relevant when considering justification for re-introducing a retirement age would be different and potentially more complex than that relied on by Oxford. One of the issues taken into account in relation to proportionality is whether the relevant legitimate aim could be achieved by less discriminatory means. Institutions operating without an EJRA will, for example, have been taking a range of measures to improve gender and ethnicity diversity and would need to carefully evaluate data on the outcomes of those measures and balance that evidence against the analysis of how introducing an EJRA would also assist with those aims.

This evidence might show that the absence of an EJRA is causing particular and identifiable difficulties - for example, a negative impact on the ability to promote greater diversity and inter-generational fairness in allocating recruitment and promotion opportunities. That could support the argument that reintroducing a retirement age is proportionate to enable greater progress to be made with those legitimate aims. Conversely, the evidence from operating without an EJRA may undermine the proportionality argument by indicating that aims similar to those relied on by Oxford can be sufficiently advanced without an EJRA, particularly when the re-introduction of forced retirement would mean removing a right to (or at least expectation of) ongoing employment irrespective of age.

The issues mentioned above do not mean that a university could not seek to reintroduce, and successfully justify, a retirement age. However, the key point is that this could not be done simply by “cutting and pasting” Oxford’s EJRA process and objective justification arguments, particularly as these start from the absence of a typical promotion and progression system. Detailed evaluation of relevant workforce data would be required, alongside an equality impact assessment, to establish that the absence of an EJRA was creating real difficulties in progressing one or more relevant legitimate aims and that it would be proportionate to address those issues through an EJRA, taking into account alternative approaches and how successful these had been since a compulsory retirement age was abandoned.

In addition, any objective justification argument would be strengthened by extensive consultation with unions and staff of the type carried out by Oxford when it adopted the EJRA in 2011 and detailed monitoring and review. This is a resource intensive process and not a one-off exercise. Further, reintroducing a retirement age would involve a change to terms and conditions of employment, meaning that universities would ned to identify a clear and effective strategy for implementing that change in the likely absence of agreement from unions and staff. Institutions could also expect early challenges to their approach through the employment tribunals and appeal courts.

While those obstacles are not insurmountable, there are alternative strategies and approaches to effective succession planning, encouraging retirement or contract change for late career staff, and for developing greater workforce diversity and tackling under-representation. Universities interested in introducing an EJRA should consider that alongside a broader range of options – doing so will help not only to develop the objective justification for an EJRA but also their assessment of whether less contentious approaches could deliver similar or better results.

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