Another blow against ‘normal age of retirement’

Human Rights Act exception ‘overly broad’ and not reasonable in current labour market: Court
By Jeffrey R. Smith
|Canadian Employment Law Today|Last Updated: 11/03/2009

A provision in the collective agreement between a Manitoba company and its union has become the latest collectively bargained mandatory retirement to fall by the wayside after the Manitoba Court of Queen’s Bench found it violated the charter rights of an employee.

Terry Kenny was a maintenance technician for Winnipeg television station CKY-TV. He had worked for the station and its predecessors for 27 years when he turned 65 in September 2006. The collective agreement, which had been negotiated by the union with the station, stipulated employees had to retire at 65. The agreement also had an article protecting employees from discrimination on several grounds, but age was not one of the prohibited grounds. As a result of the provision, Kenny’s employment was terminated.

Kenny grieved his termination, claiming the mandatory retirement provision was discriminatory and violated his rights under the Canadian Charter of Rights and Freedoms and the Canadian Human Rights Act (CHRA).

Mandatory retirement provision violated charter right: Arbitrator

An arbitrator found the mandatory retirement provisions discriminated against Kenny on the basis of age under the charter and the CHRA and he was terminated without cause. He found s. 15(1)(c) of the CHRA, which allowed for mandatory retirement if an employee reached the “normal age of retirement” for employees working in similar positions, didn’t apply and wasn’t a reasonable limit on his right to equality under the charter. As a result, the arbitrator ruled Kenny was entitled to compensation.

The station appealed the decision to the Manitoba Court of Queen’s Bench, arguing the collective agreement was freely negotiated by the union, representing Kenny and the other employees, and it was not discriminatory. It said mandatory retirement in the collective agreement didn’t have a negative impact on an employee’s dignity but rather provided “numerous benefits over the course of their careers with the security of a pension.” This was equal for all employees, the station said, and there was no differential treatment.

CHRA exception not reasonable: Court

The court found the CHRA exception for mandatory retirement for those reaching the normal age of retirement for their job was “prima facie discriminatory, reinforced preexisting stereotypes and on both an objective and subjective basisa dversely impacts a person’s human dignity” and violated Kenny’s right to equality. Therefore, the onus was on the station to prove the exemption passed the Oakes test — determined by the Supreme Court of Canada in 1986 — to determine if it was reasonable in a free and democratic society. The test contains the following requirements:

•The objective of the limit must be pressing and substantial.
•The limit had a rational connection between the objective and the means to achieve it.
•The limiting provision must be minimally impairing.
•The limit must be proportionate to the objective and the measures adopted by the law.

The court noted the Supreme Court of Canada found the CHRA exception for mandatory retirement was designed to protect pension systems and employment prospects for younger workers. This was a pressing and substantial limit that met the first part of the test. It found the exception had a rational connection to this objective, which met the second part.

However, it said the social and economic factors at the time the Supreme Court ruled on the objective of the CHRA exception in the 1990 case of McKinney v. University of Guelph were different from those of the current labour market and no longer applied.

The court also found the CHRA exception was not limited to situations where a union and employer could negotiate mandatory retirement, but could essentially allow an employer to terminate an employee by establishing a normal age of retirement for the position. As a result, the objectives defined in the first two parts of the test could be achieved without mandatory retirement and the impairment of the charter right to equality, the court said. This failed the third part of the test.

“I cannot find that there is a reasonable basis for believing that the employment regime of pensions, job security, good wages and reasonable benefits requires the maintenance of mandatory retirement at age 65 or a predominant age,” said the court.

Mandatory retirement no longer necessary: Economist

The court referred to the recent case of Vilven v. Air Canada (to view that article from the Oct. 21, 2009, issue, go to www.employmentlawtoday.com, click on “Advanced Search” and enter article #2047), where two Air Canada pilots contested the mandatory retirement provision in their collective agreement. After the Federal Court struck down the Canadian Human Rights Tribunal’s original decision that Air Canada’s retirement provision was allowed under the CHRA exception, the tribunal ruled the exception was not reasonable for the same reasons and violated the pilots’ charter rights.

The court focused on the testimony of a labour economist in Vilven that pointed out mandatory retirement was prohibited or severely limited in almost all jurisdictions in Canada without significant problems that were feared when the exception was justified.

“(Mandatory retirement) is no longer as integral to the organization of the Canada labour market as it was in 1990 when McKinney was decided,” said the court. “The overly broad exception to the otherwise discriminatory practice of mandatory retirement as found in s. 15(1)(c) of the CHRA is not justifiable and is not saved.”

The station’s appeal was dismissed and the arbitrator’s ruling that the mandatory retirement policy was discriminatory was upheld.

For more information see:

CKY-TV v. C.E.P., Local 816, 2009 CarswellMan 468 (Man. Q.B.).
•McKinney v. University of Guelph, 1990 CarswellOnt 1019 (S.C.C.).
Vilven v. Air Canada, 2009 CarswellNat 2849 (Can. Human Rights. Trib.).