Justified aims

The question raised by Case C-388/07 R (Age Concern England) v Secretary of State for Business, Enterprise and Regulatory Reform was as to the compatibility of compulsory retirement ages with Directive 2000/78/EC, which prohibits age discrimination.

The UK regulations implementing this directive provide that it remains permissible to dismiss a person at or over the age of 65 where the grounds for dismissal are retirement (and to refuse to employ a person over that age). They also provided that provisions which might permit compulsory retirement below the age of 65 if it could be shown to be a 'proportionate means' to achieve a 'legitimate aim'. But are these provisions permissible?

Legitimate social policy aim

The European Court of Justice did not actually answer this question, but it did offer a framework for analysis. In the first place, it held that all the rules fell within the general framework of the Directive. This means that it will be necessary to establish that they serve a legitimate social policy aim, which is ultimately a question for the national court.

That dealt with the provisions governing requirement at 65 or above. The ECJ had also been invited to rule that the general provision permitting the imposition of earlier retirement ages where that was a proportionate means to meet a 'legitimate aim' was automatically defective because the relevant aims were not listed. It declined to do so.

The national court would, in applying the national legislation, have to construe it in such a way as to limit the permissible aims compatibly with the Directive to important social policy objectives; but the fact that the full range of such objectives was not spelled out is not in itself problematic.

Finally, the ECJ dealt with a rather technical argument concerning the possible differences between what has to be shown in order to establish that a rule which might discriminate indirectly is permissible, and what has to be shown to justify what is, on its face, direct discrimination. An example of the first type of rule would be one which made recruitment dependent on being able to run 100 metres in under 15 seconds: the rule is not directly age-related, but it will in practice favour the young over the old. Whether it is permissible depends on whether there is a good reason for imposing the requirement. An example of the latter rule is a compulsory retirement age. Whether it is permissible depends on whether it serves an important social policy objective. The ECJ pointed out that the role of 'justification' is different in each case, and that it is important to keep the two cases distinct '“ though it did not seem to think that the basic analytical framework was likely to be very different.

Secret laws

Case C-345/06 Heinrich (10 March 2009) is at first sight an oddly trivial case. Mr Heinrich tried to board an aircraft carrying tennis racquets. The authorities in Vienna regarded these as unlawful items under a secret and unpublished annex to some community legislation, which prohibited passengers carrying 'bludgeons: blackjacks, billy clubs, baseball clubs or similar instruments'. Mr Heinrich complained to the Austrian courts.

The ECJ agreed that the Austrian authorities could not rely on the legislation against Mr Heinrich. The principle of legal certainty precludes the application of unpublished rules to impose obligations upon individuals. As the ECJ pointed out, the position was particularly absurd in this case since the community legislation itself stressed the need for individuals to know what was permitted to be taken on board an aircraft '“ but then put the list in a secret annex.

The court explained that this did not mean that the legislation was completely invalid. Member states, who did know about the terms of the annex, might still be under an obligation to prevent bludgeon-like sports equipment getting on an aircraft. But in so far as they needed to impose obligations on individuals to achieve this result, they would need to do so directly (for instance by some appropriate national law), and could not simply rely on the community legislation.

Commercial agents

In Case C-348/07 Semen (26 March 2009), the ECJ considered the scope of the right to indemnity under the Commercial Agents Directive (86/653/EEC). Although the default provision in England is for payment of compensation not indemnity, some of the court's observations are of general significance. In particular, questions about how far the principal has received 'benefits' from the commercial agent's activity may matter in cases of compensation as well as in cases of indemnity. The ECJ's comments on this aspect of the case are therefore of interest.

The ECJ held that, when considering the extent to which an agent's principal has derived or continues to derive benefits from an agency contract, the focus is on the particular legal person which acted as principal. It is not permissible to consider benefits accruing to other companies in a group. '[B]enefits accruing to other companies of [a] group are not, in principle, deemed to be benefits to the principal.' The expression of opinion in general terms is quite strong: the Directive's language positively 'precludes benefits accruing to third parties from being taken into consideration', though it remains to be seen what the ECJ might do in an extreme case.