You and your insurance company may want to employ drivers aged 25 and above, but you are on dodgy ground if you put that sentiment in a job advert. The Employment Equality (Age) Regulations 2006, which came into force on October 1 last year, outlaw age discrimination and represent "the biggest change in employment law in the past 30 years", according to Julian Cox, head of the road transport group at law firm Hextalls.
As the law is still very much in its infancy, both the TGWU and GMB trade unions say they have not yet been notified by members of any age discrimination cases under the new law. The Department of Trade and Industry (DTI) is likewise unaware of any breaches – which would have to be determined at a tribunal – although this is unlikely to be the case for long.
Legal sources estimate that there will be around 8,000 claims in 2007 citing age discrimination. As of December 2006 there were already 96 registered claims in Scotland and a further 23 in England and Wales. It is not known if any of these involve transport companies but there is no doubt that operators are taking the new legislation seriously.
Theo de Pencier, chief executive officer of Bibby Distribution, told Motor Transport: "This is something we've discussed at board level quite a lot. Case law may change the game rules but until there's case law to set a precedent,
we're waiting to see."
Compensation at an employment tribunal is potentially unlimited. So while it remains perfectly legal under the new legislation to insist that employees retire at 65, Ruth Pott, Road Haulage Association head of employment, believes that some companies are too wary of falling foul of the new law.
"There is a lack of understanding about the fair retirement procedure so companies are taking the easy option and just saying 'no', which is a shame," she says. "That's not what the legislation was designed to do."
Other hauliers seem more sanguine. Brian Lee, MD of Deeside-based Allan Morris Transport, says: "We're quite comfortable with the legislation. We have certainly employed older drivers and we do the whole band here: we have a driver of 23 through to one of 64."
Neil Roberts, director of employee relations at TNT Express UK and Ireland, says: "People who wanted to work past 65 have been able to for a number of years."
Whatever your view, Cox emphasises the importance of following the new statutory rules carefully. "If you don't get the retirement procedure right, you could be on the receiving end of an unfair dismissal claim. You need to follow the procedures to the letter," he says.
These include notifying the retiring employee of their impending retirement date and right to request to work past it within the time limits stipulated by the regulations. Even an administrative failure – such as failing to date the letter that needs to be sent notifying an employee of the outcome of any request they might make to work over their retirement date – could result in an automatic finding of unfair dismissal.
The way hauliers advertise jobs for drivers must change, with mention of a lower – or indeed upper – age limit likely to see the employer in a spot of bother. TNT's Roberts says company application forms have been amended, removing both date of birth and date of education.
James Irlam Logistics has also made changes to its policies. Gavin Shannon, transport director, says the company has changed employment policy to ensure compliance in two key areas. The first of these is greater consultation with the workforce when it comes to retirement plans for staff.
The second, perhaps more visible, change is that application forms for prospective employees now carry the word "optional" against the "date of birth" box. On that theme, Irlam has also made changes to its basic requirements for drivers for insurance purposes – removing "over 25 years" and replacing it with "two years' minimum experience" instead.
However Cox cautions against this approach. "The more experience you are asking for, the more difficult it would be to justify such a requirement under the new law as it may amount to indirect age discrimination," he says.
But some hauliers cite insurance small print as the main reason for hiring older drivers. "If you question operators further, you often find that this is not in fact the case," continues Cox. "Rather, what their insurance provisions may say is that the operator will have to pay a [higher] premium where they employ drivers under 25."
The government has indicated, as part of the consultation exercise carried out before the new rules came into effect, that the fact that it is going to cost a company additional money to insure such employees does not represent a good reason for refusing to hire them under the new legislation.
In other words, cost does not represent a legitimate "objective justification" defence.
However, the flip side of this is that insurance firms may be forced into amending their policies. Cox explains: "It may be that the insurance industry will need to re-orient itself in the next few years. Customers will be saying they can't take out certain policies which include premium provisions which relate to age because of the problems created by the new discrimination rules."
There remain a couple of other areas on which hauliers are unsure. Roberts says: "We're still seeking guidance on long service awards, trying to clarify that this is not discriminatory. Also, at the other end of the scale, if there is a 54-year-old applying for an apprenticeship and a company turns him down, are they in breach of the law?"
All this means companies are waiting anxiously for a test case. Perhaps TNT's Roberts sums the situation up best. "Legislators don't bring in laws to trap us but to make things better," he concludes. "We all run round in circles worrying for a bit and then it finds its own level."
Reed Business Information Limited.©2008
