Post Office v Massey [1993] UKEAT 568_92_2203

EAT
Post Office v Massey
[1993] UKEAT 568_92_2203 · 1993-03-22
MR JUSTICE WOOD (PRESIDENT) By an Originating Application dated 26th May 1992 the Applicant, Mr Massey, who had been employed by the Post Office since 1966 complained of "discrimination and unfair treatment". The estimated date of termination of his employment was 12th March 1992. He had reached the age of 60 on 16th January 1992. By its Notice of Appearance the Post Office denied the allegation of fact and pleaded in addition a defence under S.64(1) of the Employment Protection (Consolidation) Act 1978. The relevant wording of that section is as follows:
"S.64-(1) Subject to subsection (3), section 54 does not apply to the dismissal of an employee from any employment if the employee - (a)was not continuously employed for a period of not less than two years ending with the effective date of termination, or (b)attained the following age on or before the effective date of termination, that is to say - (i)if in the undertaking in which he was employed there was a normal retiring age for an employee holding the position which he held and the age was the same whether the employee holding that position was a man or a woman, that normal retiring age; and

(ii)in any other case, the age of sixty-five."

The "normal retiring age" (NRA) is a creature of statute. It is not the contractual date of retirement. In his dissenting judgment in the Court of Appeal in Hughes v. DHSS [1984] ICR 557 at p.581H Sir John Donaldson described it as follows -
"... A "normal retiring age" is something of an abstraction. It is an aspect of an employer's employment policy. If there is a normal retiring age or ages in an organisation, the statutory policy is that those who are retired in accordance with that policy are not allowed to complain of having been unfairly dismissed. Of course an employer may not have formulated such a policy in expressed terms, but it may nevertheless be apparent that he had one from the way in which he acts, taking account of deviations for compassionate or other special reasons. Alternatively he may have formulated and promulgated such a policy, but it is clear either that this is a sham or that he has abandoned it. In such a case the statutory age will apply, as it will if there is admittedly no normal retiring age. But that is not this case. The DHSS had a very clear policy and there is no suggestion that it was a sham or had been abandoned or modified. That concludes the issue and it would make no difference if Mr Hughes and Mr Coy were the last people to whom it would apply or if indeed whilst there was someone else in the same position the policy would not be applied to him because, for example, he had insufficient reckonable service and he would be retained for a little longer on compassionate grounds."
An Industrial Tribunal sitting at Bristol on 7th July 1992 heard the issue and decided in Mr Massey's favour that it had jurisdiction to consider his claim. The Post Office now appeal.In 1969, as the Tribunal found, the Applicant was provided with a contract of employment which stated in paragraph 4:
"The normal retirement age is shown in the Corporation's superannuation scheme. ..."
The Applicant was not supplied with any variations in the scheme.A bundle of documents was presented to the Industrial Tribunal, as it had been to us, and as a result of considering those documents the Tribunal were satisfied that the contractual retirement age both for the Applicant and for other people in his position was 60 years.The most relevant document is dated June 1980 and headed "Pay and Conditions TOO12 (formerly PHQ Circular 103/77)". It is headed "Retention beyond age 60 - UCW Grades" and is said to be a "MANDATORY instruction". The relevant wording reads as follows:
"1 This instruction promulgates the rules relating to the retention in Post Office employment, beyond age 60, of all grades represented by the UCW. ...
2 Conditions of retentionThe normal age of retirement from Post Office employment is 60 years. However, management may allow staff in grades represented by UCW to continue in Post Office employment where all the following conditions are satisfied:2.1the employee makes application to remain;2.2the employee meets acceptable standards of fitness and efficiency and is of good conduct;2.3the retention would not impede the career progression of younger, qualified staff;2.4there is a continuing need for the post occupied by the employee;All retentions beyond age 60 will be subject to review at regular intervals of 6 months.

Procedures

3 Retirement preliminariesBefore an employee reached age 59 he should be reminded that 60 is the normal retirement age by means of the letter at Appendix 1, which will also allow the employee to state whether or not he wishes to apply for retention beyond 60 in accordance with paragraph 2 above. At the same time a report on his fitness, efficiency and conduct should be obtained using a locally prepared form on the lines of Appendix 2.4 Where the employee indicates that he does not wish to apply for retention, his reply should be acknowledged in accordance with Appendix 3, the local branch of the UCW should be advised and, in due course, he should be given notice appropriate to his length of service (see Staff Contract Manual Division 4) to expire on the day preceding his 60th birthday."On 1st February 1990 there was an Internal Memorandum indicating that inquiry was being made of the possibility of allowing Mr Massey to be retained in employment beyond the age of 60. The decision was reached later in February that this would not be so. However, on 18th June 1990 a letter was sent from the Personnel Department to Mr Massey, the first paragraph of which reads:
"As you know the normal age of retirement from Post Office employment is 60 years. However there are circumstances under which certain individuals may be retained beyond 60. These are explained in PI:P1 TOO11 to TOO12."
No reply was received, but during the Summer the Post Office changed its mind and by November 1990 was prepared to consider retention of the Applicant. He was reminded by a letter of 3rd December that he had not replied and on 4th December he replied as follows:
"I wish to be considered for continued employment beyond the normal age of retirement age of 60 in accordance with the rules."
By a letter of the same date he asked that he should be allowed to work part-time instead of full time. A reply was sent - in confidence - dated 6th February 1991, and acknowledged by Mr Massey on the 7th, indicating that his current and past sickness absent record threw doubt on whether he could be retained. He was warned that unless his sickness absence record improved, there were grave doubts about the possibility of his continuance.On 17th June 1991 Mr Massey wrote seeking the possibility of part-time work.On 31st July 1991 the Post Office wrote as follows:
"I am pleased to inform you that it is the Post Office intention to offer you continued employment beyond the normal retiring age of 60.
We will be writing to you 3-4 months before your 60th birthday to offer a variation to your contract of employment which will provide for your continued employment with the Post Office beyond the age of 60."On 11th September 1991 he was asked whether he would wish to continue in employment without formally retiring or whether he would wish formally to retire under Section A or Section B of the Pension Scheme. He replied to the effect that he wished to continue in employment without formally retiring.On 20th December 1991 the Post Office wrote indicating that as Mr Massey had been on sick leave since 5th September 1991, suffering from depression, it was unable to offer acceptable terms for future employment and therefore he was given formal notice of termination. His right of appeal was explained to him.The Industrial Tribunal based their decision upon a passage in the speech of Lord Fraser of Tullybelton in Waite v. Government Communications Headquarters [1983] ICR 653 at p.662 where he says:
"... Having regard to the social policy which seems to underlie the Act - namely the policy of securing fair treatment, as regards compulsory retirement, as between different employees holding the same position - the expression "normal retiring age" conveys the idea of an age at which employees in the group can reasonably expect to be compelled to retire, unless there is some special reason in a particular case for a different age to apply. "Normal" in this context is not a mere synonym for "usual". The word "usual" suggests a purely statistical approach by ascertaining the age at which the majority of employees actually retire, without regard to whether some of them may have been retained in office until a higher age for special reasons - such as temporary shortage of employees with a particular skill, or a temporary glut of work, or personal consideration for an employee who has not sufficient reckonable service to qualify for a full pension. The proper test is in my view not merely statistical. It is to ascertain what would be the reasonable expectation or understanding of the employee holding that position at the relevant time. The contractual retiring age will prima facie be the normal, but it may be displaced by evidence that it is regularly departed from in practice. The evidence may show that the contractual retirement age has been superseded by some definite higher age, and, if so, that will have become the normal retiring age. Or the evidence may show merely that the contractual retiring age has been abandoned and that employees retire at a variety of higher ages. In that case there will be no normal retiring age and the statutory alternatives of 65 for a man and 60 for a woman will apply."
In the recent case in this Appeal Tribunal of Barclays Bank Plc v. O'Brien & Ors (19th January 1993) we referred to recent decisions in the Court of Appeal as follows:
"We gratefully accept the apt definition of the issue to be decided from the leading judgment of Dillon LJ in Barber v. Thames Television Plc - [CA Wed. 29th April 1992 as yet unreported] - where he says at p.5G of the transcript -
"In the jurisprudence which has developed under section 64, the persons who hold the same position as defined in section 153(1) as a particular employee have been referred to as "the group" to which that particular employee belongs. The word "group" is not to be found in the Act itself. It was introduced by Lord Fraser of Tullybelton in Waite v. Government Communications Headquarters [1983] 2 AC 714 . A summary therefore of the effect of section 64(1)(b) is that a person whose employment is terminated because he has reached the normal retirement age of his group cannot complain of unfair dismissal. There is no jurisdiction to entertain his complaint because the opening words of section 64(1)(b) provide that section 54 does not apply to the dismissal of such an employee from his employment.

(b) "

We would only add, by way of comment, that if "Group" is to be understood in this technical sense, it is important to limit its use to that sense.In the recent reported decision in the Court of Appeal in Brooks v. British Telecommunications Plc [1992] ICR 414 - the reserved judgments were given on 27th November 1991, but it is not cited and we believe was not referred to in Barber - the Court of Appeal posed the question to be answered as follows - (see Balcombe LJ at p.424D-E and Sir Christopher Slade at p.434D) -"What at the effective date of termination of the applicant's employment and on the basis of the facts then known, was the age at which employees of all age groups in the applicant's position could reasonably regard as the normal age of retirement applicable to the group".We would respectfully suggest a slight alteration from "of all age groups" to "of all ages" to meet the problem posed above."In Waite (supra) Lord Fraser used the expression "compelled to retire". The normal retirement age is the age at which normally a member of the group of which the applicant was a member could expect to have to retire. We do not see that there is a distinction for purposes of statistics between a voluntary retirement on notice without a request to continue, or compulsory retirement on notice despite a wish to continue. They are each of them retirements at the normal retiring age. Although our remarks in Brooks v. British Telecommunications Plc [1991] ICR 286, 314D were made obiter at the request of the parties, we can see no reason for departing from that view. It is particularly to be noted that the facts in Randall v. The Post Office [1977] IRLR 346 were almost identical with those in the present case and although not binding upon us, are indeed guidance from Mr Justice Bristow and the members sitting with him. The industrial members sitting with me entirely agree with that decision.The questions for the Industrial Tribunal to ask were:(a) Was there a contractual age for retirement which was prima facie the normal retirement age? - They answered 'yes' - aged 60.(b) What was the "group" of which Mr Massey was a member? The answer is agreed to be the UCW grades within the television licencing operators, but there was no indication of the numbers involved.(c) Was there a scheme in existence pursuant to which employees could extend their service with the Post Office? The only answer to that is that there was as indicated in the documentation.(d) If so, was such extension at the discretion of the Post Office and were conditions attached - in particular, were terms and conditions of service to be materially different? The answer to this must surely, on the documentation, be 'yes'.(e) Was the scheme so operated that the prima facie normal retirement age in the contract - age 60 - proved to be a sham? See Hughes (supra).(f) Posing the question put by the Court of Appeal in Brooks - "What at the effective date of termination of Mr Massey's employment and on the basis of the facts then known, was the age which employees of all ages in Mr Massey's group could reasonably regard as the normal age of retirement applicable to that group?"In the present case some statistics were produced by the Post Office, which, in our judgment may have tended to mislead the Tribunal. These showed that between 13th March 1990 and 12th March 1992, 34 members of the relevant group had reached the age of 60. Of these 13 had retired on their 60th birthday, 2 had been given notice of retirement although they wished to continue in service. Eleven had continued in service although they had taken their pension and therefore "retired". Only 8 had continued in service without taking their pension and could therefore be said not to have "retired". This was some 24% of the total.However, these statistics are misleading because they refer only to those in the relevant group who had reached the age of 60 in the two year period. The answer to (f) above must be sought from employees of all ages in the group. The numbers within the group and the age structures are unknown. To treat these statistics as immediately relevant was to take the same course which was suggested in Brooks (supra), but which was rejected by the Industrial Tribunal, this Tribunal and the Court of Appeal.In paragraph 10 of its Decision the Tribunal says:
"... We have to use our common sense and it seems to us that common sense dictates against the proposition that in March 1992 an employee who attained the age of 60 would reasonably expect to be compulsorily retired. ..."
In this approach the Tribunal, as it seems to us, have looked at the reasonable expectation of those approaching the age of 60 in March 1992 and not the reasonable expectation of those of all ages within the group. In so doing there was an error.Mr Brennan, for the Post Office, makes a number of other criticisms of the reasoning of the Tribunal in that paragraph 10. First, he submits that it was wrong when considering such statistics as were available to regard those who had accepted retirement but continued in service to be counted as having retired at age 60. For the reasons which we have given above we agree with this submission. Secondly, he submits that the Tribunal erred in commenting "there is no evidence that these people were retired and then offered some alternative employment at a lower salary". He submits that although strictly true, that statement does not take into account the fact that the terms and conditions of service after "retirement" were different from those which existed before and indeed were subject to three months' notice. This, he submits, was a radical change. We agree. Thirdly, he submits that the Tribunal misunderstood the phrase "compelled to retire" as explained above and we agree with this comment. The importance, as he submitted, was to see the numbers of those who in fact retired at age 60. Fourthly, he submits that the view of the Industrial Tribunal that the facts of Brooks and Waite could be materially distinguished is erroneous and that the principles therein stated should be applied. We respectfully agree.If the Industrial Tribunal had approached the issue before them in the way which we believe is now dictated by the House of Lords and the Court of Appeal, and indeed the guidance of this Court in Randall , it seems to us that the only conclusion which could have been reached on the documentation was that the normal retirement age in the present case was 60.The burden of proof in the present case is upon Mr Massey and we would respectfully adopt the words of Lord Fraser of Tullybelton in Waite at p.663C:
"... The fact that just over one quarter of the relevant group of officers were retained after they had attained age 60 falls far short of showing that the contractual retiring age had been abandoned or departed from. If the case had been a narrow one on its facts, one in which a tribunal might reasonable have taken the view that the contractual age had been abandoned, your Lordships might have thought it right to remit the case to an industrial tribunal to come to a decision on the facts. But in my view no tribunal applying the law correctly could find that the contractual retiring age had been departed from in this case. Accordingly I consider that the appellant has failed to show that the industrial tribunalhad jurisdiction to consider his complaint."
Having already indicated that the statistics in this case are capable of being misleading, it seems to us that whether one regards the statistical approach or the approach on the overwhelming evidence on the documentation, there can only be one answer in this case on a correct application of the law and that is that the Applicant has failed to show that an Industrial Tribunal has jurisdiction in the present case. The appeal is therefore allowed and a declaration to that effect substituted.