Secretary of State for Trade and Industry (Respondent)v.Rutherford and another (FC) (Appellants) and others

For the purposes of article 141 of the EC Treaty, the relevant comparison is between male and female workers who are in the same position and doing equal work. An age-based rule which removes dismissal and redundancy rights from everyone who continues to work after a specified age does not indirectly discriminate on grounds of sex merely because more men than women remain in employment after that age.

The statistics must show a substantially greater comparative disadvantage to one sex among those seeking the relevant benefit. Where no such disparity is established, the question of objective justification does not arise.

The appellants were men dismissed after age 65. They claimed redundancy payments and, in Mr Rutherford’s case, compensation for unfair dismissal. Sections 109(1)(b) and 156(1)(b) of the Employment Rights Act 1996 excluded those claims where the statutory default retiring age applied.

The Employment Tribunal twice held that the exclusions should be disapplied as indirectly discriminatory under article 141 of the EC Treaty. The Employment Appeal Tribunal allowed the Secretary of State’s appeal. The Court of Appeal dismissed the appellants’ appeal: [2004] EWCA Civ 1186; [2005] ICR 119. The House considered whether the higher proportion of men working after 65 established indirect sex discrimination.

1. The appeals were unanimously dismissed. Lord Scott, Lord Rodger and Baroness Hale adopted the broader analysis that article 141 requires equal pay for male and female workers doing equal work in a comparable position. A man working after 65 could compare his pay package with that of a woman working after 65. The statutory package was reduced to the same extent for both. Article 141 did not guarantee that he should receive the higher package available to a woman under 65.

2. Per Lord Rodger, the statistics showed only that a higher proportion of men than women continued to work after 65. They did not show that a higher proportion of the men who worked after 65, as compared with women who worked after 65, received the reduced package. Subject to a statutory qualification, all members of both groups did.

3. Baroness Hale held that the comparison must be confined to persons who want the benefit or wish to avoid the disadvantage in question. Workers who had already left the workforce had no interest in continuing to enjoy protection against unfair dismissal and redundancy. Within the group still working after 65, the exclusion affected men and women alike.

4. Lord Nicholls and Lord Walker also concluded that the statistics did not establish a substantially higher proportion of disadvantaged men. Lord Walker’s alternative analysis compared both the advantaged and disadvantaged proportions in the relevant pool. The negligible difference in the advantaged proportions could not be displaced by the 1.44:1 disparity within the small disadvantaged group.

5. Since no indirect sex discrimination was shown, the House did not decide whether the exclusions could be objectively justified. The Court of Appeal’s dismissal of the claims was affirmed.

• House of Lords: dismissed the appeals and affirmed the Court of Appeal.
• Court of Appeal: dismissed the appellants’ appeal from the Employment Appeal Tribunal: [2004] EWCA Civ 1186; [2005] ICR 119.
• Employment Appeal Tribunal: on 2 October 2003, allowed the Secretary of State’s appeal from the Employment Tribunal.
• Employment Tribunal: on 22 August 2002, held that the statutory exclusions were contrary to article 141 and should be disapplied.
• Employment Appeal Tribunal: on 10 July 2001, allowed Harvest’s appeal in Mr Rutherford’s case and remitted it: [2002] ICR 123.