The Court of Appeal has confirmed by a majority, that using length of service in redundancy selection criteria is lawful.
In Rolls Royce plc v Unite (the Union), the High Court held that although a length-of-service factor is discriminatory on the grounds of age, it was objectively justified. The Court of Appeal agreed.
The Court of Appeal made a declaration that the use of length of service as one of the criteria in a redundancy selection process is indirectly discriminatory but it was justified – as one of a number of criteria – being a proportionate means of achieving a legitimate aim, namely the reward of loyalty and the desirability of achieving a stable workforce in the context of a fair redundancy selection process.
The Court of Appeal also expressed the provisional view that awarding points for length of service was capable of constituting a "benefit" within the meaning of regulation 32.
Reg 32 broadly provides that an employer may treat workers differently by reference to length of service in relation to the "award of any benefit" and, where length of service exceeds five years, requires that it must reasonably appear to the employer that the way in which it uses length of service fulfils a business need.