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Industrial Tribunals Northern Ireland Decisions
You are here: BAILII >> Databases >> Industrial Tribunals Northern Ireland Decisions >> McIvor v The Chief Executive Officer So... [2009] NIIT 1248_08IT (18 December 2009)
URL: http://www.bailii.org/nie/cases/NIIT/2009/1248_08IT.html
Cite as: [2009] NIIT 1248_08IT, [2009] NIIT 1248_8IT
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THE INDUSTRIAL TRIBUNALS
CASE REFS: 01248/08
01050/08
CLAIMANT: Geraldine McIvor
RESPONDENTS: 1. Department of Education
2. The Chief Executive Officer Southern Regional College
DECISION
The decision of the Tribunal is:
(i) The claimant’s claim against the first–named respondent was lodged out of time, but in all the circumstances of the case it would be just and equitable to extend time to allow the claim to be heard and we so order.
(ii) The Teachers’ (Compensation for Redundancy and Premature Retirement) Regulations (NI) 1991 apply to the claimant’s situation and do not fall under the “statutory provision” exemption in Regulation 28 of the Employment Equality (Age) Regulations (NI) 2006 (as amended) (“the Age Discrimination Regulations”).
(iii) Regulation 6 of the 1991 Regulations referred to above falls within the exception set out in para, 13B of Part 2 of Schedule 1 to the Age Discrimination Regulations and so its application to the claimant does not constitute unlawful age discrimination.
Constitution of Tribunal:
Chairman: Miss E McCaffrey
Panel Members: Mr J Kinnear
Mr R Hanna
Appearances
The claimant appeared in person and represented herself.
The first-named respondent was represented by Dr T McGleenan, Barrister-at-Law instructed by the Departmental Solicitor’s Office.
The second-named respondent was represented by Mr Eamon McArdle, Barrister-at-Law, instructed by E McEvoy and Company, Solicitors.
1. The Issues
The issues for determination in relation to this matter were identified at a Case Management Discussion held on 27 April 2009 and are as follows.
(i) Is the claimant’s claim time-barred against the first-named respondent, having been lodged on 11 September 2008 with regard to a decision made on 19 April 2008 and, if so, is it just and equitable to extend the time-limit for presenting the claim? At the hearing the parties agreed that the final decision regarding the claimant’s pension was communicated to her by letter dated 9 May 2008, not 19 April and so time began to run from that date.
(ii) Was the claimant entitled to six years added compensation for voluntary redundancy in light of her 28 years service?
(iii) Was the claimant’s entitlement to added years compensation subject to the Teachers’ (Compensation for Redundancy and Premature Retirement) Regulations (Northern Ireland) 1991?
(iv) What is the effect of Regulation 6(1)(b) of the 1991 Regulations upon the claimant’s entitlement to additional service credit?
(v) Was the decision to award the claimant a total of 4 years and 362 days of additional credit discriminatory on grounds of age contrary to the Employment Equality (Age) Regulations (Northern Ireland) 2006?
These four questions ((ii) to (v)) are the core issues of this case.
(vi) What effect, if any, does Regulation 35 of the Employment Equality (Age) Regulations (Northern Ireland) 2006 have on the claimant’s claim?
In the course of the hearing, it became clear that this regulation had no real relevance to the issues in this case, which relate to pensions rather than redundancy payments and so we propose not to deal with this question.
2. The Facts
2.1 This case was one where there was little dispute as to the facts of what had actually occurred and the main argument centred on legal issues. The parties agreed that the response lodged by the second named respondent could usefully be adopted as a statement of chronology of facts and we restate the facts here briefly for ease of reference.
2.2 The claimant was employed by the second named respondent as a Lecturer at the Southern Regional College; she was Head of Faculty and had been employed by the College since 1 September 1980. Her employment ended on 30 April 2008 by reason of voluntary redundancy, combined with early retirement. It is the retirement package she was offered which has given rise to this complaint.
2.3 The second named respondent was implementing a new management structure as part of the merger of Armagh College, Newry Institute and Upper Bann Institute on 1 August 2007. Following an internal trawl amongst management staff seeking expressions of interest in voluntary redundancy, the claimant submitted her expression of interest dated 21 November 2007. This document also gave the second-named respondent permission to contact the claimant’s relevant pension provider to ascertain her benefits under the relevant scheme. By a letter dated 20 December 2007, the claimant was advised that the first-named respondent had been requested to provide an estimate, detailing the pension benefits to which she would be entitled.
2.4 By letter dated 8 January 2008, the claimant indicated that she had raised a query regarding the compensation linked to retirement and was awaiting clarification. By letter dated 18 January 2008, the second named respondent reminded the claimant that there was still no confirmation from the first-named respondent (The Department of Education for Northern Ireland) with regard to the funding of added years for any redundancies declared as at 31 March 2008. This is significant because although the second-named respondent was the employer, it was the first-named respondent which determines the claimant’s terms and conditions of employment. At a meeting between the claimant and the second-named respondent on 18 March 2008, the claimant was provided with an estimate of allowance in the event of redundancy, which had been prepared by the first-named respondent. Formal notice was given to the claimant on 19 March 2008 that the claimant would be entitled to pension benefit in line with the first-named respondent’s estimate as provided at the meeting on 18 March 2008. The claimant was advised that she would be allowed additional service credit of 4 years and 362 days, as she was aged 60 at the date of retirement and could only be awarded additional credit for the period between the date of her retirement and her sixty-fifth birthday under the applicable Redundancy Regulations (see below). The claimant agreed to accept this package on a “without prejudice” basis, as she wished to pursue the matter further.
2.5 Meetings on the issue continued until the claimant finished her employment on 30 April 2008, at which time she had lodged a grievance in relation to her pension calculation. The grievance was heard on the afternoon of the claimant’s last day at work, and was decided against her. She received a letter dated 9 May 2008, confirming the decision that she was not eligible for the maximum 6 years’ additional pension credit. She was invited to lodge an appeal, which she did. The initial date for hearing of the appeal did not suit the claimant and the second-named respondent admitted it had been lax and had failed to follow up on arranging an alternative date. The claimant then lodged her claim against the second-named respondent in July 2008 with the Tribunal Office and subsequently lodged a claim against the first-named respondent and the second-named respondent on 11 September 2008. The claimant’s comment on this was that she thought she had to have the appeal dealt with first.
2.6 The procedure applied by the second-named respondent to the processing of voluntary redundancies for academic redundancies is set out in the Teachers’ Premature Retirement Compensation Scheme Circular 1999/30. This circular detailed the additional compensatory years which may be awarded, which are aggregated from one to 6.66, based on length of service. The maximum award of compensatory years for staff with 29 years or more of reckonable service is 6.66 years. As the claimant had 28 years service at 30 April 2008, she was advised that she was eligible for a maximum of 6 years’ compensatory service. Because the claimant was a member of the Northern Ireland Teachers’ Pension Scheme (NITPS), her redundancy was processed in accordance with the Teachers (Compensation for Redundancy and Premature Retirement) Regulations (Northern Ireland) 1991 (“the Redundancy Regulations”).
2.7 The Redundancy Regulations set out the basis on which teachers who take early retirement are to be compensated for redundancy and also set out the conditions under which they can be given additional service credit for the purposes of calculating their pension. The claimant’s case is that it was the way these regulations were applied to her which constituted age discrimination. For the purposes of this case, the regulations which are most important are Regulations 4 and 6 which provide as follows:-
“4.(1) Part II applies to any person who has become entitled to a redundancy payment under the 1965 Act in consequence of his having - …………….
(b) ceased after 31 March 1991 to be employed in relevant employment.
(2) Parts III to V apply to eligible teachers.
(3) An eligible teacher is a person who has ceased to hold his former employment and –
(a) who, immediately before the material date, was in relevant employment; and
(b) in relation to whom the conditions specified in paragraph 4 are satisfied.
(4) The conditions referred to in paragraph (3)(b) are that –
(a) when the teacher’s employment was terminated he had attained the age of 50 but had not attained the age of 65 years;
(b) he then had, or but for an election under Regulation 12 of the Miscellaneous Provisions would have, been employed in reckonable service for the purposes of the Superannuation regulations for at least five years;
(c) he had become entitled to payment of annual allowance under Regulation 48(1)(c) of the Superannuation Regulations (incapacity);
(d) the former employer had notified the Department that the employment was terminated by reason of his redundancy or in the interests of the efficient discharge of the employer’s function; and
(e) in respect of a person in employment category C, E or G was terminated in the interests of the efficient discharge of the employer’s functions, the Department approves the reason of that termination.”
Regulation 6 deals with additional service credit and is the matter at the core of this case. It reads as follows:
“6(1) The deciding authority may, within six months after the material date, credit an eligible teacher with a period of service not exceeding the shortest of -
(a) the period by which his effective service falls short of 40 years;
(b) the period beginning on the day following the material date and ending with his 65th birthday, less, where paragraph 1 of part 2 of the Schedule applies any period required by paragraph 2 of that Part to be deducted;
(c) the length of his effective service; or
(d) ten years.”
2.8 The claimant alleged that she had been discriminated against on grounds of her age, in that she had been allowed only 4 years and 362 days’ additional service credit because that was the period of time to run between her date of retirement and normal retiring age of 65 while a colleague aged 52, with similar service, received the full 6 years additional service credit. The claimant argued that she might have applied to work beyond the age of 65 and suggested this would be grounds for extending the period of additional service credit. The second-named respondent pointed out that if the claimant had not applied for voluntary redundancy and had been successful in securing a post in the new structure, she would indeed have continued to work up to normal retiring age of 65 and beyond, subject to approval. She could also have continued to make contributions to the pension scheme. The second-named respondent however would not have been in a position to award any compensatory years from 1 September 2008 onwards, due to changes in funding of premature retirements for teachers.
3. The Relevant Law
3.1 Apart from the Redundancy Regulations referred to above, the relevant law in relation to the issues in this case is to be found in the Employment Equality (Age) Regulations (Northern Ireland) 2006 and the Employment Equality (Age) (Amendment NO. 2) (Northern Ireland) Regulations 2006. The amended regulations set out amendments to Schedule 2 of the Age Regulations, specifically in relation to the matter of Occupational Pension Schemes. For the sake of convenience, we refer here to these amended regulations as “the Age Discrimination Regulations 2006.” These regulations were implemented to give effect to the UK’s obligations in relation to discrimination on grounds of age as found in Council Directive 2000/78/EC.
3.2 The relevant parts of the Age Discrimination Regulations 2006 for the purposes of this case are to be found in the following regulations which are set out here for ease of reference.
3.3 The first issue we have to address relates to the issue of time limits and whether the claimant’s claim against the first-named respondent is time-barred. In relation to the issue of time limits, the relevant regulation is regulation 48, which provides:
“48 (1) An industrial tribunal shall not consider a complaint under Regulation 41 (Jurisdiction of Industrial Tribunals) unless it is presented to the tribunal before the end of the period of three months beginning when the act complained of was done;
(2) Where the period within which a complaint must be presented in accordance with paragraph (1) is extended by Regulation 15 of the Employment (Northern Ireland) Order 2003 (Dispute Resolution) Regulations (Northern Ireland) 2004 the period within which the claim must be present shall be the extended period rather than the period in paragraph 1…..
(4) A court or tribunal may nevertheless consider any such complaint or claim which is out of time if, in all the circumstances of the case, it considers that it is just and equitable to do so……….”
3.4 In relation to questions (ii) to (v), the relevant regulations of the Age Discrimination Regulations are those which relate to occupational pensions and their relationship to the Redundancy Regulations. The argument advanced by the first-named respondent was that the Redundancy Regulations, being statutory provisions, are exempt from the Age Discrimination Regulations 2006 by virtue of Regulation 28 of those Regulations. That regulation provides that nothing in Part II or Part III of the Age Discrimination Regulations shall render unlawful “any act done in order to comply with the requirement of any statutory provision.” They argued that for either of the respondents to give the claimant more favourable benefits than those set out in the Redundancy Regulations would be beyond the power of the respondents and so unlawful. We consider the case law on the issue of the “statutory provision” exemption in discrimination law below, but first we set out the provisions of the Age Discrimination Regulations on occupational pensions relevant to the determination of the issues in this case.
3.5 Regulation 12 (1) sets out a general prohibition on discrimination in the operation of occupational pension schemes, except in relation to rights accrued or benefits payable in respect of periods of service prior to
1 October 2006.
Question (vi) of the questions we have to address refers to Regulation 35 of the Age Discrimination Regulations 2006. That Regulation provides an exception for the provision for enhanced redundancy payments to employees. The regulation sets out the nature of enhanced redundancy payments which will be acceptable, even though they include an element of discrimination on grounds of age. We do not set it out in full here as it seems to us that this is really of limited application in this particular case, a matter which is dealt with further below.
3.6 Schedule 1 (Part 1) (as amended) of the Age Discrimination Regulations 2006 includes a provision that every occupational pension scheme shall be treated as including a non-discrimination rule outlawing age discrimination (Rule 2 (1)). It provides that other provisions of the scheme are to have effect subject to the non-discrimination rule. However, Part 2 of the Schedule (as amended) goes on to set out rules, practices, actions and decisions relating to occupational pension schemes which are exempt under the age discrimination legislation. The rationale for this is set out in some detail in the various studies and consultation papers which were published by the Department of Trade and Industry prior to the introduction of the Age Discrimination Regulations 2006. In particular, the explanatory memorandum to the Regulations and the final Regulatory Impact Assessment which were published through 2005 set out the Government’s view on, amongst over things, the impact of the age discrimination legislation on occupational pensions. It is clear that the Government recognised that occupational pensions schemes contained a great number of age-based rules which were necessary for their effective operation and management. The final Regulatory Impact Assessment issued in relation to occupational pensions goes on to state:
“In the context of Age Discrimination Legislation our aim is to ensure that employers are not discouraged from maintaining Occupational Pension Schemes for their employees. We will do this by allowing employers and trustees, as far as possible, to maintain existing age based rules.” Later in the document it states, “There is the potential for age legislation to jeopardise the provision of occupational pensions if employers or trustees decide to close or level down schemes rather than face legal challenges, even unsuccessful ones.”
3.7 The explanatory memorandum on the Age Regulations makes comments in relation to the nature and type of the protection against age discrimination. It also comments on exceptions for statutory authority and statutory benefits. At paragraphs 7.23 and 7.24 of the Explanatory Memorandum, it states as follows:-
“7.23 Age criteria are used widely in legislation. As a consequence, those who have to comply with such legislation may have to discriminate on grounds of age. They should not have to fear that in doing so they would violate these regulations. The exception for Statutory Authority provides absolute protection in those circumstances.”
“7.24 As part of the preparation for introducing regulations, all Government departments have conducted a review of their legislation to ensure that any age based provisions in the field of employment and occupation, including vocational training are justified or removed. The same considerations will apply to future legislation.”
3.8 Under Schedule 1, Part 2 of the Age Discrimination Regulations 2006, various practices which are exempt from the effect of the Age Discrimination Regulations are set out. The rules set out in Part 2 are lengthy and complex, but the paragraph which, it seems to us, may have most relevance in this case is paragraph 13B which reads as follows:-
“13B (1) A minimum age for any member of a scheme for payment of or entitlement to a particular age related benefit on the grounds of redundancy where it is enhanced in accordance with sub-paragraph (2) and paid either with or without consent (whether of an employer, the Trustees or Managers of the Scheme or otherwise).
(2) The enhancement of any age related benefit payable to or in respect of a member on the grounds of redundancy where the enhancement is calculated on one or more of the following ways:-
(a) By reference to the years of prospective pensionable service a member would have completed had he remained in pensionable service until normal pension age;
(b) By reference to a fixed number of years of prospective pensionable service;
(c) By making an actuarial reduction which is smaller than if early retirement had been on grounds to which paragraph 12 applied;
(d) By not making any actuarial reduction for early retirement.
(3) Sub-paragraph (1) shall also apply to different minimum ages for different groups or categories of members.”
The “statutory provision” exemption in discrimination law.
3.9 All the anti-discrimination legislation applicable in the United Kingdom provides for an exemption for acts done under statutory authority. The terminology may vary a little, but the substance is the same. So the caselaw on such an exemption applies equally to Regulation 28 of the Age Discrimination Regulations 2006. The most recent leading case is the decision of the House of Lords in Hampson v Department of Education and Science [1990] IRLR 302, which concerned the comparable provision in the Race Relations Act in Great Britain. The Secretary of State for Education had refused Mrs Hampson’s application to have her Hong Kong teaching qualifications recognised in the United Kingdom, acting under the relevant statutory regulations. Lord Lowry, giving the leading speech, took the view that the “statutory provision” exemption should be narrowly construed. In his view, only an act done in the necessary performance of an express obligation is covered by the exemption. Referring to the judgment in the Court of Appeal on the issue, Lord Lowry noted that to adopt a wider construction, allowing acts done in pursuance of a power or discretion conferred by a statutory provision to be exempt under the race discrimination legislation, risked defeating the object of the statute. As he observed,
“What I would venture to describe as the fallacy of that approach can be recognised when one reflects that almost every discretionary decision such as that which is involved in the appointment, promotion and dismissal of individuals in, say, local government, the police, the National Health Service and the public sector or the teaching profession, is taken against a statutory background which imposes a duty on someone, just as the Regulations of 1982 imposed a duty on the Secretary of State.”
4. Decision
Question (i)
4.1 There is no issue regarding the claim against the second-named respondent, which is in time. The only issue relates to the claim against the first–named respondent, DENI. That claim was lodged out of time and although the claimant had lodged a grievance against the decision to refuse her the full 6 years’ additional service, it is not clear that she had lodged a grievance with DENI as opposed to the Southern Regional College, her employer. However the first-named respondent was aware of her request for voluntary redundancy and that she had queried the calculation of her pension entitlement, so they were aware of the issues raised by this claim. Had the claimant lodged a grievance against the first-named respondent when she lodged a grievance against the second-named respondent, it would have extended the time limit for her to bring a claim against the first-named respondent. The claimant also said that she had understood she should wait for the grievance to be resolved before lodging her claim. In all the circumstances of the case, we consider it would be just and equitable to extend the time limit to allow the claimant’s claim against the first named respondent to be heard.
Questions (ii) to (v)
4.2 We propose to take these questions together as they are inter-related. It seems clear to us that the Redundancy Regulations apply in this case and
that, even if it was found that those regulations were discriminatory on grounds of age, that finding could only be made in relation to any period of service after 1 October 2006 (see Regulation 12 of the Age Discrimination Regulations 2006).
4.3 The next issue to consider is whether the Redundancy Regulations fall outside the age discrimination legislation, because they constitute a statutory exemption under Regulation 28 of the Age Discrimination Regulations 2006. The regulation at issue here is regulation 6, which is set out above at para. 2.7. The regulation allows the deciding authority (in this case, the relevant employer) a discretion to credit a teacher with additional service. That period of additional service must not exceed the shortest of the four categories set out in regulation 6 and the period applicable to the claimant is as set out in Regulation 6(1) (b), i.e. the period of time between her redundancy and her 65th birthday.
4.4 Applying the decision in Hampson discussed above, we are of the view that the Redundancy Regulations form part of the terms and conditions of employment of teachers in Northern Ireland. To give a wide construction to Regulation 28 would leave a potentially wide area of discrimination immune from challenge. Following the ruling in Hampson and applying the narrow construction, the issue is whether the act done was in the necessary performance of an express obligation in the statutory instrument under consideration. Regulation 6 (1) gives a discretion rather an obligation to the deciding authority (“the deciding authority may….”) as to whether any additional service credit is given and then sets out the appropriate way of calculating it. Because the deciding authority has a discretion, we take the view that this is not the necessary performance of an express obligation: the deciding authority could decide not to grant any additional service at all if it chose to do so, or could decide to give a lesser period (“a period of service not exceeding the shortest of….”). Accordingly, we have concluded that the Redundancy Regulations do not fall under the statutory provision exemption in Regulation 28.
4.5 The next issue to decide is whether the provisions of the Redundancy Regulations fall within any of the exceptions set out in Part 2 of Schedule 1 to the Age Discrimination Regulations 2006, which would render them lawful and not discriminatory. We have set out above (at para 3.8) the provisions of rule 13B of Part 2, which seems to us to be applicable in this case. The claimant suggested that this regulation did not apply to her because there was no minimum age for payment of enhanced benefit on grounds of redundancy. This is not the case, as Regulation 4 of the Redundancy Regulations stipulates that to be eligible, a teacher must be at least 50, but under 65 years of age, so there is a minimum age requirement. The other requirement of Rule 13B is that the enhancement to pension must be calculated in one of four ways, set out in rule 13B (2). One of these is rule 13B (2) (a), which allows for the enhancement to be calculated by reference to the number of years of pensionable service the scheme member would have completed had he remained in service until normal pension age. This is precisely the effect of Regulation 6(1)(b) of the Redundancy Regulations and the exact provision applied to the claimant, to put her in the position she would have been in had she worked to normal retirement age. Accordingly, we find that the Redundancy Regulations fall within the exception set out in Rule 13B (2) (a) of Schedule 1 to the Age Discrimination Regulations 2006, and so are not unlawful under the age discrimination legislation.
4.6 We have also considered, finally, the claimant’s argument that she should be awarded the full six years additional credit because, if she had remained at work, she would have been able to work beyond the age of sixty-five. This may be the case, but there is no certainty that she would have worked beyond sixty-five and so this is somewhat speculative. What is clear is that the second–named respondent would not have been able to award the claimant additional service credit beyond her sixty-fifth birthday under the Redundancy Regulations and we have already decided that Regulation 6 of those regulations is permitted under the exceptions to the Age Discrimination Regulations 2006. For all of these reasons, the claimant’s claim of age discrimination is dismissed.
Chairman:
Date and place of hearing: 12 October 2009, Belfast.
Date decision recorded in register and issued to parties: