A key difference between age discrimination and other forms of discrimination is that direct discrimination can be justified. In other areas of discrimination, the defence of justification is only available in indirect discrimination claims. This means that less favourable treatment on the grounds of age can be justified if the employer can show that it is a proportionate means of achieving a legitimate aim.

In this case, an employment tribunal had to decide whether or not a redundancy scheme that made payouts based on a percentage of gross pay depending on age and length of service could be justified. There were significant jumps in the level of payment when employees reached a particular age or number of years' service. The tribunal found that the scheme was justified.

The EAT said that, in principle, encouraging and rewarding loyalty and giving a larger financial payment to older workers because they are more vulnerable in the job market are legitimate aims. However, it went on to say that the employment tribunal had missed out the next stage: were the large jumps in payments for older workers a proportionate way of achieving these aims? The case was sent back to the tribunal to consider this issue.

XpertHR's line manager briefing on age discrimination [subscription required] covers justification.

Read the transcript (Microsoft Word format, 91K) of the case on the EAT website.

UPDATE: The EAT has considered justification of direct age discrimination in redundancy schemes again in Loxley v BAE Systems Land Systems (Munitions & Ordnance) Ltd.