In the case of Heskett v Secretary of State for Justice, the EAT considered whether the 'absence of financial means' was sufficient to be considered a "legitimate interest" capable of justifying indirect age discrimination. The EAT held it was.
On the facts, the Secretary of State for Justice operated a policy which limited pay increases across the public sector, due to budgetary constraints imposed by the Government. The EAT concluded that the policy was objectively justified on the facts and was, therefore, not in breach of the Equality Act. The EAT distinguished this case to make it clear that this was not a 'costs alone' case. The Court said allocating resources in order to break even is capable of justifying indirect age discrimination.
It is important for employers to appreciate the distinction to be drawn between absences of means (i.e. an inability to make pay increases as a result of external factors) and seeking to rely solely on costs saving reasons. The former may well justify indirect discrimination, the latter is less likely.
First published Jul 4, 2019.
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