Employers should not take too much comfort from the ruling in favour of City law firm Freshfields Bruckhaus Deringer (Freshfields) in Bloxham v Freshfields, the first major test of the new regulations on age discrimination which came into effect last October.
The employment tribunal found that there had been potentially discriminatory treatment of Peter Bloxham, but that, in this case, it had been objectively justified by the firm.
Bloxham, a former partner at Freshfields, claimed that on the closure of the law firm’s existing pension scheme, the transitional provisions that were put in place were discriminatory.
Under the old scheme and the transitional arrangements, a partner who was aged 54 years at the time of the scheme’s closure and retired with consent would receive a discounted pension while employees aged 55 years and over would get their full pension entitlement.
Bloxham was 54 years-old at the time so received a discounted pension and therefore, he claimed, had been treated less favourably because of his age.
The tribunal found that Freshfields had a legitimate aim in reforming its pension arrangements because the changes would lessen the ‘intergenerational unfairness’ caused by the structure of the existing scheme, which would have resulted in the younger partners contributing more and more to the scheme yet themselves receiving an increasingly smaller return.
Rachel Dineley, partner and head of the age discrimination unit at national commercial law firm Beachcroft, said: “Although Peter Bloxham lost his case, Freshfields was still accused of discrimination, although this was considered ‘proportionate’. This is a unique aspect of age discrimination law which provides that discrimination can be justified if it is of proportionate means in achieving a legitimate aim.”
While further cases will provide more clarification around certain areas of age discrimination, David Fisher, head of the employment team at Nabarro, warned: “Employers should review their policies and perks to highlight where age or length of service are a factor.”