Applying lower salary scales to new recruits is not discriminatory

19 March 2019Salary & Benefits

The fact that an employer, applies lower salary scales and a lower function-level for newly recruited workers, hired after a specific date, does not constitute indirect discrimination on grounds of age.

 

1. The facts

 

In 2011, the Irish Department of Education hires two young teachers.

 

A ministerial circular provides, as from 1 January 2011:

 

  • A 10% decrease in the remuneration for new recruits compared to the remuneration of teachers already in service;
  • A classification of new recruits at a level 1 grade, whereas teachers were previously hired at a level 2 or 3 grade in the Irish civil service.

 

This new regime is applicable to all teachers hired after 1 January 2011, regardless of their age.

 

The two teachers challenge these measures and claim that there is indirect discrimination based on their age because 70% of the workers affected by this reform are younger than 25.

 

2. Decision of the European Court of Justice

 

Directive 2000/78 of 27 November 2000 establishing a general framework for equal treatment in employment and occupation prohibits all forms of direct or indirect discrimination on grounds of age, among others.

 

  • Direct discrimination on the basis of age occurs when a person of a given age is treated less favourably than another person in a comparable situation;

 

  • Indirect discrimination on grounds of age occurs when an apparently neutral provision, criterion or practice would put persons of a particular age at a particular disadvantage compared to other persons, unless the provision, criterion or practice is objectively justified by a legitimate aim and the means of achieving that objective are appropriate and necessary.

 

According to the Court, there is indeed a difference in treatment between teachers already employed by the public authority and the new recruits.

 

However, the Court finds that the only relevant criterion for the application of the new salary-scales is the date of recruitement, irrespective of their age at the time of recruitment.

 

According to the Court, this criterion is an objective and neutral element, distinct from any consideration of the age of the workers recruited. The fact that the majority of new recruits are younger than 25, is irrelevant.

 

Consequently, the new salary scales introduced by the employer are not based on any criteria directly or indirectly related to the age of the workers. There is therefore no direct or indirect discrimination in this case.

 

3. Lesson learned

 

The employer may hire new workers by applying less favourable working conditions (remuneration, scale level, etc.) than those granted to workers already employed in the company.

 

However, the employer must:

 

  • Comply with the working conditions and remuneration scales determined by law or by agreement;
  • Determine a clear “cut-off date” for the application of the new working conditions;
  • Provide that this new regime will be applied to all new recruits, regardless of age.

 

Source: C.J.E.U., 14 February 2019, C-154/18, www.curia.europa.eu