Employment Law and Retirement Ages

Quigley v Health Service Executive [2017] IEHC 654

This article examines a recent decision of the High Court in the above matter dated 26th October 2017.

The Plaintiff was employed with the HSE as a General Practitioner, specialising in substance abuse.  The Plaintiff attained the age of 65 on the 19th October 2017. 

The Plaintiff received a letter from the Defendant informing him that his employment would terminate on his 65th birthday and that his last day of employment would be 18th October 2017 by reason of the fact that the plaintiff would then reach the retirement age of 65 years of age.

The Plaintiff contended that the Defendant was not entitled to terminate his employment on the basis of retirement on his 65th birthday and sought an injunction restraining the purported termination of his employment pending the determination of the proceedings.

The Plaintiff contended that the termination of his employment was invalid as his contract of employment was not subject to maximum retirement age.   The Plaintiff referred to the fact that the contract explicitly set out that it was to be of indefinite duration.  

He contended that he was entitled to remain in employment for as long as he was willing and able to do so.  He submitted that he received approximately three weeks’ notice from his employer about termination of his employment and this was after nineteen years’ service.

In response, the Defendant submitted that the Plaintiff was a permanent officer of the defendant and was subject to a retirement age of 65.  The defendant maintained that Public Service Superannuation (Miscellaneous Provisions) Act 2004 superseded the Plaintiff’s position and that he was bound by what is contained therein.   The position of the Defendant was that the Plaintiff must have known that he had to retire upon reaching the age of 65, as this was the statutory retirement age for permanent officers who joined the public health service at the time the Plaintiff did.

The Defendant relied on the case of O’Reilly v. Irish Press [1937] 71 ILTR 194 in support of its contention that retirement at age 65 is an implied term in the contract of employment and that the court would have to be satisfied in respect of an implied term on the basis of custom and practice in an employment context that the fact would be so notorious as to be well known and acquiesced in that in the absence of agreement in writing it is to be taken as one of the terms of the contract between the parties and further that it would be necessary in order to establish a custom of the kind claimed that it be shown that it was so generally known that anyone concerned should have known of it or could easily have become aware of it.

The Court referred to the fact that it was submitted on behalf of the Plaintiff that a number of other GPs, who were older than the Plaintiff, who had not been asked that their employment be terminated, nor had they heard of other GPs who had been asked to retire at 65.

This was clearly a difficulty for the Defendant’s position and was a significant factor in persuading the Court to ultimately grant the injunction sought.

In granting the injunction, the Court referred to the Supreme Court’s decision in Maha Lingam v HSE [2005] IESC 89, which stated that the test to be applied is that it is necessary for the Plaintiff to show at least that he has a strong case and that he is likely to succeed at the hearing of the action, not simply a prima facie case.

The Court took the view that in Dr. Quigley’s case, the Plaintiff had produced a strong and clear body of evidence about his contention as to the position pertaining and that he had made out a strong case which was likely to succeed.  The court was persuaded by the fact that the contractual situation as of 2001 was to the effect that the period of employment was indefinite, and this position was not altered by either party.  The Court also referred to the fact that at least two medical doctors working in the Substance Abuse area who were employed in 2001 have continued on in their employment beyond the age of 65. 

The Court was of the opinion that damages would not be an adequate remedy for the Plaintiff and if he does not return to work, he will suffer a loss of professional prestige and standing in respect of which monetary compensation would be inadequate.

The Court was satisfied that the balance of convenience favoured the granting of the relief sought.

This case again brings the subject of retirement ages into focus.  In this case, there was no express retirement age set out and therefore the employer sought to rely on evidence outside of the contract to demonstrate that a retirement age of 65 was implied into the Plaintiff’s Contract.

It is important for employers to consider the position carefully where the question of retirement arises.

Where there is an express retirement age set out in an employee’s Contract, employers still need to be sure that the particular retirement age is objectively justified, otherwise the employer may be open to an age discrimination claim.

The absence of an express retirement age in an employee’s contract is not fatal for an employer, but there must be clear evidence that the retirement age is implied into the Contract, that that particular retirement age is enforced by the employer (ie. that other employees have not been permitted to work beyond that age) and that it is objectively justified.

Employers may face a potential legal liability in situations where:

• there is no retirement age set out in the employee’s Contract/Statement of Terms and Conditions of Employment;
• the employer does not have a clear and notorious policy or custom and practice of retiring employees at 65;
• there is no objective justification for compelling the employee to retire at the age of 65;

If employees in those circumstances are mandatorily retired by their employer upon reaching a certain age, it may be open to the employee to institute a claim for unfair dismissal and/or a claim for discrimination on the grounds of age and/or a breach of Contract claim.