Executives and Age Discrimination

The United Nations in 2020 declared 2021-2030 as the Decade of Healthy Aging and launched a global collaboration with the aim to improve the lives of older people, their families, and the communities in which they live. The UN declaration recognises the world is not sufficiently prepared to respond to the rights and needs of older people despite the world population ageing at an accelerating pace. The global collaboration is an attempt to address these issues. This article discusses the ongoing developments in the arena of age discrimination in Denmark.

On 2 November 2022, Mette Klingsten participated in a panel debate, together with Bjarke Oxlund, professor at the Department of Anthropology at the University of Copenhagen, Anette Tybjerg-Jeppesen, researcher in age discrimination at the Center for Healthy Aging at the University of Copenhagen, and Naima Yasin, head of the SAGA Secretariat and podcast host, on ” How and why does age discrimination show up in our society ? During the debate the panel discussed, among other things, how age discrimination legislation is a constantly developing area.

In 2004, age was introduced as a protected characteristic in the Danish Discrimination Act, due to the implementation of the Employment Directive (Directive 2000/78 on general framework regulations for equal treatment in employment and occupation). The Discrimination Act prohibits direct and indirect discrimination in the labor market based on age. An employer may therefore not discriminate against employees or job applicants when hiring, dismissing, transferring, promoting, or in respect to pay and working conditions.

The developments in age discrimination legislation have included the prohibition on a mandatory default retirement age. Until 2006 it was possible for an employer to terminate an employee once they reached the age of 65. The age limited was increased to 70 in 2006, however since 1 January 2016 it is now prohibited to have a mandatory retirement age in Denmark.

A further area of development in age discrimination legislation relates to the question of whether directors can be described as “salaried employees” for the purposes of the Discrimination Act. The Ministry of Employment initially considered that directors were not “salaried employees” for the purposes of the Discrimination Act when age was introduced as a protected characteristic in the Discrimination Act in 2004. However, in the 2006 guidance on the Discrimination Act, the Ministry of Employment took a different stance and considered that the legislation also applied to managing directors. The European Court of Justice has also confirmed that the prohibition against discrimination on grounds of age also applies to directors.

Most recently, the European Court of Justice has considered a preliminary question from the Eastern High Court, on whether board members are also protected by the prohibition against discrimination on grounds of age.

The case, which was initially dealt with at the Equal Treatment Board, concerned the question of whether it was discriminatory pursuant to the Discrimination Act to prevent a candidate from standing for election as sector chairman in HK as a result of statutory age limits contained within the article of association. The candidate had first been elected as sector chairman in 1993 and had then been re-elected as sector chairman every four years until the autumn of 2011, when she could no longer stand for election, as HK’s article of association stipulated a maximum age of 60 for candidates.

The sector chairman complained to the Equal Treatment Board that the prohibition on her appointment based on her age constituted age discrimination. The Equal Treatment Board found that the post of sector chairman was a professional occupation within the meaning of the Employment Directive and thus covered by the Discrimination Act, regardless of the fact that the post contained elements that were characteristic of both of an employment and self-employment relationship. The sector chairman was therefore successful with her complaint and was awarded compensation of DKK 25,000.

HK refused to pay the compensation, and the case was therefore brought before the Eastern High Court. In a ruling of 6 November 2020, the High Court asked the EU Court of Justice whether the employment directive should be interpreted in such a way that a politically elected sector chairman in a trade union is covered by the scope of the Employment Directive.

The European Court of Justice answered the question by stating that the EU legislation did not intend to limit the Employment Directive’s application to “employees” (the Discrimination Act uses the term “salaried employees”), and that the directive applies to all persons “regardless of industry and regardless of level in the occupational hierarchy”. Therefore, it did not matter that the office was of a political nature. The European Court of Justice also stated that it is of no consequence that the position of sector chairman is filled by election, and that the terms “paid employment” and “professional employment” should not be interpreted restrictively.

Against this background, the European Court of Justice ruled that the Employment Directive must be interpreted in such a way that an age limit for a chairman of a workers’ organization would fall within the provisions of the Employment Directive.

The significance of the European Court of Justice’s decision is still unknown, as the Eastern High Court has yet to make a final determination on the case. However, whilst the decision from the European Court of Justice is clear in relation to the Employment Directive’s scope of application, it cannot be ruled out that the High Court will find that the Discrimination Act – which only protects “salaried employees” – cannot be interpreted in such a way that a politically elected sector chairman is also protected by the Discrimination Act. In other words, even if the Discrimination Act implements the Employment Directive (which should be interpreted to include a sector chairman) and even if the legislation must be interpreted as far as possible in accordance with the Employment Directive, it would be contrary to the wording of the legislation – contra legem – that a person who in in other contexts is not an employee, in the sense of the Discrimination Act must be perceived as such.

Regardless of the High Court’s decision in the specific case, the scope of the European Court of Justice is significant, as it is clear that the Employment Directive covers not only workers, but also those who exercise a position that they have obtained through election. This is relevant for, among other things, members of the boards of directors who are elected at a general meeting, and where it must be assumed that a statutory age limit for obtaining election will be in breach of the prohibition against age discrimination pursuant to the Employment Directive. The Discrimination Act contains authority for the relevant departmental ministers to deviate from the ban on age limits, following an opinion from the Minister of Employment. However, such exceptions must be within the scope of the Employment Directive, including that the aim is legitimate and that the requirement is proportionate.