Length of service criterion in redundancy selection was not unlawful age discrimination

In Rolls Royce plc v Unite the Union the Court of Appeal has held, by majority, that the inclusion of a length of service criterion in a redundancy selection policy constituted a proportionate means of achieving a legitimate aim. The Court also gave the provisional view that the use of length of service as a criterion could be considered a ‘benefit’ under Reg 32 of the Employment Equality (Age) Regulations 2006.

RR plc and the union entered into collective agreements relating to redundancy for two groups of employees. Both agreements provided that redundancy selection would involve a points scoring system, under which employees were assessed in various categories such as expertise and versatility. Each employee was also to receive one point per year of continuous service. A dispute arose over whether this length of service criterion complied with the Age Regulations. The parties asked the High Court, under Part 8 of the Civil Procedure Rules, to settle the matter.

The High Court held that, while the criterion was age discriminatory, it was objectively justified under Reg 3. The collective agreements were designed to enable any redundancies to be carried out fairly and ‘peaceably’. In the High Court’s view, this was a legitimate aim. In any event, the agreements would fall within the exemption provided by Reg 32, which exempts certain benefits based on length of service from the general prohibition on age discrimination. According to the High Court judge, allotting points for long service in a redundancy selection procedure may mean workers keep their jobs, which ‘would properly be described as a benefit’. The inclusion of a length of service criterion in the collective agreements was therefore lawful. RR plc appealed.

The Court of Appeal has now dismissed the appeal, although it accepted that there was force in the appellant’s argument that the High Court had failed to address the critical question of proportionality. Lord Justice Wall, giving an opinion with which Lady Justice Arden broadly agreed, held that the legitimate aim was to reward loyalty and create a stable workforce in the context of a fair redundancy selection process. He thought it proportionate to use length of service as a criterion because it was just one of many criteria used, and was not determinative of the selection. Furthermore, the Court was unanimous in its (obiter) view that, for the purposes of Reg 32, use of a length of service criterion could constitute a benefit.

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