The eradication of compulsory retirement and age discrimination in the Australian workplace: a cause for celebration and concern.

• Jurisdiction: Australia
• Author: Patterson, Rachael
• Date: 01 January 2004

Earlier this year the Age Discrimination Act 2004 was passed by the Commonwealth government. This paper provides an overview of the Age Discrimination Act 2004 and critically examines whether it is likely to be successful in eradicating compulsory retirement and age discrimination within the workforce. Empirical studies suggesting that law reform alone is insufficient to eliminate ageist employer behaviour are discussed as is the need for public awareness campaigns. Given that compliance with the law is closely linked with normative belief, this paper also considers whether a moral duty to refrain from age discrimination can be grounded within the natural law ethic.

A Introduction

Over the past three decades Australia has made significant progress in protecting employees from discrimination on the basis of race, sex, and marital status. Commonwealth legislation prohibiting racial discrimination was first introduced in 1975 with the Racial Discrimination Act 1975. Two years later NSW enacted the Anti-Discrimination Act 1977 and in the early 1980s federal legislation addressing sex discrimination was introduced with the Commonwealth Sex Discrimination Act 1984. When it has come to protecting mature age workers against age discrimination, however, the law has shamefully lagged behind. (1)

Although provisions providing for compulsory retirement were removed from the Commonwealth Public Service Act in 1999, it was not until 2001 that it was more generally abolished in the federal public sector when the Abolition of Compulsory Age Retirement (Statutory Officeholders) Act 2001 was passed. A federal prohibition of age discrimination was achieved only this year with the recent implementation of the Commonwealth Age Discrimination Act 2004 (the Age Act).

Although many states enacted provisions prohibiting compulsory retirement prior to this, the legislation tended to be piecemeal and inconsistent. In New South Wales, for example, age discrimination was made unlawful only in 1994 with the Anti-Discrimination (Amendment) Act 1994. Although compulsory retirement was prohibited in NSW at an earlier date, this initial protection did not extend to those in partnerships nor did it prohibit voluntary retirement schemes based on age. (2)

The Age Act is a welcome and much needed addition to our slate of anti-discrimination laws. The fact remains, however, that even with these legislative initiatives, older people and mature age workers will still be subject to ongoing hidden discrimination. Research shows that mature age workers are least preferred for employment and most likely to be targeted for retrenchment. (3) Attitudes such as these mean that people aged 45 years and over are more likely than younger persons to remain unemployed for longer periods of time. (4)

Ageist stereotyping is in a large way to blame for this, with older people often being seen as 'stupid, decrepit, feeble, or unusually eccentric, wise or sweet natured, and in any event to be patronised'. (5) In the workplace mature age workers are perceived as 'not likely to change', 'not open to new skills', unable to 'catch up on computer literacy' and more likely to 'get sick'. (6) Research, however, indicates otherwise.

The prevalence of ageist stereotypes indicates our lack of willingness to recognise older people as a diverse group of people with a wide array of skill sets. That it was almost 30 years after the implementation of the Racial Discrimination Act 1975 that the Commonwealth finally enacted the Age Act indicates how lowly we prioritise the prevention of age discrimination. This is cause for considerable concern.

Whilst it is possible to coerce people into refraining from directly discriminating against mature age workers, in order to eradicate the more insidious and hidden forms of age discrimination in the workplace, it is important, firstly, to source our legal imperatives within a normative understanding of the issue and, secondly, to encourage people to see it as a normative issue with extensive public awareness campaigns on the deplorability of age discrimination. Research has shown normative belief to be closely linked with compliance with the law. People do not obey the law simply because it is in their self-interest to do so but because they also believe it is morally proper to do so. (7)

This paper provides an overview of the relevant provisions of the Age Act and existing state law on compulsory retirement and age discrimination within the workplace. Part three critically examines the reforms and assesses whether the Age Act is likely to achieve its objectives. Of particular concern is the vulnerability of some mature age workers not protected by the provisions due to exemptions in the Age Act, and the fact that, of those who are, many are still subject to hidden discrimination and constructive compulsory retirement. Given that compliance with the law is closely linked with normative belief, part four of the paper sets out a normative basis for why age discrimination and compulsory retirement are wrong.

B Age Discrimination Act 2004

In the second reading speech for the Age Act, the then Attorney General, Daryl Williams, argued that age discrimination against older workers was prevalent and caused by negative stereotyping. Williams claimed that it was important for Australia to avoid the social and economic costs of age discrimination by ensuring 'full participation in public life by order persons'. (8) This, however, would require the removal of barriers to older people participating in society, particularly the workforce. The Age Act, he observed, would assist with the removal of these barriers and 'send a powerful message about the importance of eliminating unfair age discrimination'. (9)

In furtherance of these objectives, the Age Act prohibits direct and indirect discrimination against people on the basis of age under a number of circumstances including employment, education, access to premises, access to goods, services and facilities, accommodation, land and requests for information.

1 Direct and Indirect Discrimination in the Age Act

Section 14 of the Age Act defines direct discrimination as occurring when the discriminator treats the aggrieved person less favourably than someone of a different age because of:

(i) the age of the aggrieved person; or

(ii) a characteristic that appertains generally to persons of the age of the aggrieved person; or

(iii) a characteristic that is generally imputed to persons of the age of the aggrieved person.

Indirect discrimination is defined by section 15 as when, because of a person's age, a discriminator:

(a) ... imposes, or proposes to impose, a condition, requirement or practice; and

(b) the condition, requirement or practice is not reasonable in the circumstances; and

(c) the condition, requirement or practice has, or is likely to have, the effect of disadvantaging persons of the same age as the aggrieved person.

The Explanatory Memorandum to the Age Act explains that in the case of indirect discrimination, a person of a particular age is disadvantaged because the person is unable to meet a condition, requirement or practice that, although apparently neutral, is more difficult for people of that age to meet. Unless the discriminator is able to show that the condition is reasonable in the circumstances, it will constitute unlawful discrimination. (10)

For an action to constitute indirect discrimination it must be done by reason of the complainant's age. However, where some other reason is involved, section 16 of the Age Act provides that the act (being either direct or indirect discrimination) will still be taken as being done by reason of the person's age where 'one of the reasons is the age of the person' and 'that reason is the dominant reason for doing the act'.

Although the Age Act is quite broad in its application, Division 2 of Part 4 deals specifically with age discrimination in the workplace. Section 18(1) prevents employers from discriminating against a person on account of their age when offering employment or determining the terms and conditions of employment. Section 18(2) makes it unlawful for an employer to discriminate against a person on the basis of age by 'dismissing' that person, failing to offer them 'opportunities for promotion, transfer or training ... or any other benefits associated with employment', or subjecting them to some form of 'detriment'.

It is too early for any cases to have been brought before the courts pursuant to the Age Act. Even so, many of its terms have been judicially considered within the context of other anti-discrimination laws. Accordingly, the term 'detriment' has been given a broad definition that includes any kind of non-trivial disadvantage. (11) In O'Callaghan v Loder, for example, Mathews DCJ treated the term as 'requiring that a complainant has been placed under a disadvantage in comparison with employees of the opposite sex'. Applying this definition within the context of age discrimination would mean that a detriment is suffered when an employee is 'placed under a disadvantage' in comparison with employees of a different age. The word 'benefit' has also been widely construed by the court as meaning 'any advantage or opportunity generally provided by the employer to an employee'. (12)

The effect of section 18(2) is to prohibit compulsory retirement not only in the case of public servants but for all other employees as well. Provisions similar to section 18 applying to commission agents (section 19), contract workers (section 20), partnerships (section 21), and qualifying bodies (section 22) are also included in the Age Act.

3 Exemptions to the Prohibition on Compulsory Retirement

Despite the general prohibition on compulsory retirement, it is not unlawful for an employer, partnership, principal or employment agency to discriminate against another on the ground of age (being an employee, partner, commission agent, contract...