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The Age Discrimination Act 2004 (Cth) ("AD Act") is the Australian federal law that prohibits age discrimination. Prior to the commencement of the AD Act, remedies for age discrimination were only available under State or Territory anti-discrimination laws, which all prohibit discrimination based on a person’s age.

Australian State and Territory anti-discrimination laws operate concurrently with the AD Act. Therefore, a person or group will have to decide whether to bring a complaint under the AD Act or the applicable State or Territory law. If a person or group makes a complaint regarding age discrimination under a State or Territory law, they will not be also be able to make a complaint under the AD Act. However, if a complaint is first made under the AD Act, the complainant will usually not be prohibited from subsequently initiating a complaint under the applicable State or Territory Law.

The AD Act prohibits both direct and indirect discrimination on the ground of age. Age is defined as including age group. Accordingly, an act of discrimination does not have to be linked to an exact age but can be related to the age group of a person.

Direct discrimination occurs when someone treats, or proposes to treat, the aggrieved person less favourably than it treats, or would treat, a person of a different age under circumstances that are the same or materially the same, if the discriminator does so because of the aggrieved person’s age or a characteristic that appertains or is generally imputed to a person of that age.

Indirect discrimination occurs when someone discriminates against the aggrieved person on the ground of their age by:

  • imposing or proposing to impose a condition, requirement or practice;
  • the condition, requirement or practice is not reasonable; and
  • the condition, requirement or practice has or is likely to have the effect of disadvantaging persons of that age.

A significant issue for employers is vicarious liability. Under the AD Act, where the unlawful conduct is done by one person on behalf of an employer (for example, by an employee), the employer may be vicariously liable for the conduct and orders may be made against the employer.

The employer will be able to defend an allegation of vicarious liability if it can establish that it took reasonable precautions and exercised due diligence to avoid the unlawful conduct occurring.

In addition to electing between the AD Act and State or Territory anti-discrimination laws, if the complainant alleges discrimination in the context of employment, the complainant may also elect to make a claim under the Fair Work Act 2009 (Cth) ("FW Act").

In broad terms, under the FW Act, the ‘General Protections’ provisions prevent employers from taking ‘adverse action’ (for example, dismissal, altering the employee’s position to his or her prejudice, discriminating between the employee and other employees, refusing to employ a prospective employee) against a person because of the person’s age ("General Protection Provisions").

Finally, an employee who has their employment terminated because of age may also make an ‘unlawful termination’ claim under the FW Act.

Who’s covered?

The AD Act makes it unlawful to discriminate against a person on the ground of age in the following areas:

  • employment and employment related matters (including the employment of contract workers);
  • education;
  • access to premises;
  • provision of goods, services and facilities;
  • provision of accommodation;
  • disposal of land;
  • administration of Commonwealth laws and programs; and
  • requests for information on which age discrimination might be based.

What enforcement/remedies exist?

The AD Act does not provide for remedies for age discrimination. The relevant remedy provisions are found in the Human Rights and Equal Opportunity Act (1986) (Cth). A court may make any one or more of the following orders when unlawful discrimination is established. A Court may order that a respondent:

  • pay damages to the applicant;
  • not repeat or continue the discrimination;
  • perform any reasonable act or course of conduct to address any loss or damage suffered by an applicant;
  • employ or re-employ an applicant; or
  • vary the termination of a contract or agreement.

The State and Territory anti-discrimination laws provide for similar types of remedies. Although in New South Wales and Western Australia the amount of damages is capped at $40,000.

An award of damages is the most common remedy in discrimination complaints, although ‘softer’ remedies such as public apologies and training appear increasingly common. Damages are awarded as a remedy to place the complainant in the position that they would have been in had the discrimination not occurred. Compensation is awarded under two heads – special damages and general damages.

Special damages compensate for quantifiable economic loss. For example, if a complainant can establish that their employment was terminated because of discrimination, then the complainant can claim for past and future loss of wages.

General damages are awarded to compensate the complainant for the hurt, humiliation and loss of dignity suffered.

Disputes involving an alleged contravention of the General Protections Provisions under the FW Act will generally be dealt with at first instance in a conference by Fair Work Australia. However, employees can elect to go directly to the Federal Court or the Federal Magistrates Court if they wish (except where there is a dismissal, in which case a FWA conference is mandatory). Where the matter proceeds to court, the maximum penalty payable is $33,000 in the case of a corporate employer and $6,600 in the case of an individual in respect of each breach. Compensation or reinstatement of the employee may also be ordered.

The main remedies for unfair dismissal are reinstatement, often with back pay, or monetary compensation. If reinstatement and back pay are ordered, a Court must have regard to the employee’s income or likely income between the time of dismissal and the time of reinstatement. In some cases reinstatement is ordered without back pay.

How common are claims?

In the 2009 -2010 reporting year, the Australian Human Rights Commission received 174 complaints made under the AD Act, of which approximately 65% related to employment.

In the last 5 years the number of complaints has increased over 60% and almost 50% of complaints are made by complainants aged 45-64 years.

What claims are most common and what are the trickiest issues for employers?

Complaints of ageism or age discrimination by mature age workers (i.e. workers over 45 years of age) are much more common than claims by younger workers.

A very challenging new issue for employers is that the General Protections Provisions under the FW Act carry a ‘reverse onus’. This means that where an employee alleges that he or she has suffered adverse action for a prohibited reason (i.e. age), the court will presume that this is the case unless the employer can prove otherwise. For example, if an employee alleges that they were not recruited because of their age, the employer must prove that age had no part in the decision not to recruit that employee.

A reverse onus of proof also applies in unlawful termination cases. The employer must, by leading evidence, exclude the possibility that termination occurred because of the employee’s age. Several decisions in this are say that the employer must ‘eliminate the prospect’ that the termination was effected by any prohibited reason (i.e. age).

The reverse onus requirements of the FW Act were widely expected to result an increase in discrimination claims. This has not, however, occurred to date, although it could be anticipated as employees and their representatives become more aware of this new complaint avenue.

Another difficulty for employers is the potential for discrimination tribunals to accept statistical evidence when considering whether discrimination has occurred. In Virgin Blue Airlines Pty Ltd v Stewart & Ors (2007) EOC 93-457, flight attendants complained that Virgin discriminated against them on the ground of age in their job application selection process. The process included testing for ‘behavioural competencies’, one of which was described as having ‘Virgin flair’ – making the flying experience fun for the customer. The Queensland Anti-Discrimination Tribunal examined statistical evidence of Virgin’s selection results (only one employee over 35 (aged 36) had ever been hired) and concluded on this basis that the process it used discriminated on the basis of age.

Are there any specific exemptions?

Not all discrimination on the basis of age is unlawful. There are a number of areas of exemption under the AD Act including:

  • employment for domestic duties in private households;
  • superannuation, insurance and credit;
  • migration and citizenship;
  • taxation;
  • pensions, allowances and benefits;
  • some health programmes;
  • certain acts of religious and voluntary organisations;
  • compliance with specified laws;
  • youth wages or compliance with industrial agreements and awards; and
  • positive discrimination (for example, discrimination which provides a bona fide benefit to persons of a particular age).

In addition, under the AD Act a significant exemption is available in respect of the employment provisions. It is not unlawful to refuse to employ a person, or to terminate a person’s employment, if they are unable to perform the ‘inherent requirements’ of the particular job because of their age. This exemption only applies to recruitment and termination. Accordingly, during the employment relationship, an employer cannot rely on the ‘inherent requirements’ exemption to treat an employee less favourably because of their age.

The State and Territory laws provide similar exemptions in the area of age discrimination.

The exemptions to the General Protections Provisions and unlawful dismissal under the FW Act include:

  • action that is not unlawful under State or Federal anti-discrimination law;
  • action that is taken because of the ‘inherent requirements’ of the position; and
  • action that is taken in accordance with particular religious beliefs in order to avoid injury to the religious susceptibilities of adherents to the religion.

Retirement ages

The AD Act does not expressly proscribe compulsory retirement. Complainants wishing to bring a claim under the AD Act, alleging age discrimination on the basis of having been compulsorily retired from work, would need to utilise the general prohibition against age discrimination in employment.

Alternatively, at the federal level, a complainant may bring a claim under the General Protections Provisions or unlawful termination provisions of the FW Act.

In contrast to the situation at the federal level under the AD Act, compulsory retirement is expressly unlawful throughout the various State and Territory jurisdictions in Australia.

Interesting cases

In the decision of the Australian High Court in Qantas Airways Limited v Christie [1998] HCA 18, the High Court considered the scope of the ‘inherent requirements’ exemption. In this case, Qantas argued that its policy to require pilots to retire at the age of 60 was a genuine and reasonable inherent requirement of being a pilot because:

  • of safety concerns associated with allowing pilots to continue to work after turning 60; and
  • the Convention on International Civil Aviation barred captains aged 60 or over from flying many of the routes which they might be asked to fly.

The High Court found in Qantas’ favour on the basis of the second argument – that is, it was an inherent requirement of a pilot’s position to be able to fly over countries which were signatory to the Convention.

This decision is important because it establishes the principle that the ability to perform the inherent requirements of the position is not limited to being able to psychically perform the duties. The Court held that the ability to perform the inherent requirements of the position also required the employee to do the job within the particular operational setting of the employer.

In another case involving Qantas, Blatchford v Qantas Airways Limited (1997) EOC 92-888, it was held that selection criteria for new employees which are based on age are likely to be found discriminatory. In this case, applicants for the position of pilot were subject to a particular criterion which assigned points to applicants based on their age (applicants aged 21-24 years scored four points; those aged 32 years and over scored one point). Qantas argued that older applicants would have a shorter period of employment and so the airline would have less opportunity to recoup its training costs. In concluding that this selection criterion was unlawful age discrimination, the New South Wales Equal Opportunity Tribunal concluded that anti-discrimination law did not make any exceptions for economic rationalism.

In another case considering the legality of recruitment criteria, Dewan v Main Roads WA (2005) EOC 93-362, the Western Australian Equal Opportunity Tribunal held that a job advertisement that sought to recruit ‘recent graduates’ did not amount to age discrimination against graduates over 25, even though a majority of recent graduates would be younger than 25. Accordingly, the Tribunal dismissed a complaint from a 45 year-old engineer of indirect age discrimination. The Tribunal found that the emphasis on recent graduation could apply to different age groups and did not necessarily demonstrate an intention to recruit young employees.