Mandatory retirement age not unconstitutional in Canada

Air Canada Pilots Association v Kelly and Others, 2012 FCA 209 (17 July 2012)

A full bench of Canada’s Federal Court has found that mandatory age-based retirement schemes are not unlawful under the constitutional Charter of Rights and Freedoms, despite limiting the right to equality. In reaching this conclusion the Court applied earlier precedent which says that mandatory retirement is a justifiable limit on human rights.

Facts

The applicants were two former Air Canada pilots who were forced to retire aged 60 years in accordance with their enterprise agreement and pension plan. The pilots complained that the mandatory retirement scheme discriminated against them on the basis of age and breached their rights under the Canadian Human Rights Act (CHRA).

The respondents, Air Canada and the Air Canada Pilots’ Association, relied on the exception to the prohibition against age discrimination under paragraph 15(1)(c) of the CHRA, which provides as follows.

(1) It is not a discriminatory practice if … (c) an individual’s employment is terminated because that individual has reached the normal age of retirement for employees working in positions similar to the position of that individual;

The pilots challenged the constitutionality of that exception. The case turned on the question of whether the exception fell within the test set out in section 1 of the Charter, namely whether the exception was “reasonable” and “demonstrably justified in a free and democratic society”.

Decision

Ultimately, the Court held that the Federal Court was bound to apply precedent set by the Canadian Supreme Court in McKinney v University of Guelph [1990] SCJ No. 122, which said that mandatory retirement at age 65 breached the protection against age-based discrimination, but was nonetheless constitutionally valid because of section 1 of the Charter.

On that basis, the Court ordered the matter to be remitted back to the Canadian Human Rights Tribunal with a direction that the complaints be dismissed.

Discussion

This decision leaves open the prospect of the Canadian Supreme Court revisiting the laws surrounding mandatory retirement schemes in light of social, contextual and attitudinal changes. It also contains some interesting discussion about the role of collective bargaining in the context of balancing and limiting human rights.

The Court was required to revisit McKinney in order to consider whether it was binding precedent in this case. In doing so, it compared the context in which McKinney was decided with the current circumstances.

The point was made that mandatory age-based retirement schemes have long been a feature of the industrial landscape in Canada. In McKinney, this was seen to be an important factor in terms of balancing the right to non-discrimination with the rights of employers and employees to negotiate terms and conditions of employment.

After close analysis of the McKinney decision, the Court said:

In my view, what McKinney did decide was that mandatory retirement, as an exception to the prohibition against discrimination on the basis of age, could be justified under section 1 of the Charter when it is a mutually advantageous arrangement between employers and employees which permits the workplace to be organised in a manner that accommodates the needs of both parties. While these types of arrangements are not limited to unionised workplaces, La Forest J [in McKinney] was very conscious of the significant role that collective bargaining plays in achieving these types of accommodations.

The Court saw no reason to depart from these principles in the case of the Air Canada pilots. The Court pointed out that Air Canada had been collectively bargaining with its employees since 1945 and its pension plans had provided for compulsory retirement since 1957. The implicit suggestion is that the collective bargaining process achieves, of its own accord, an appropriate balance between individual human rights other competing interests, meaning that courts ought to be less inclined to intervene in those circumstances.

Although the Court decided that it was bound by the precedent set by McKinney, the decision concludes with the comment that “it may be that conditions have changed to the point where the Supreme Court is prepared to revisit this issue. If it is, then, obviously, nothing in this decision would prevent it from doing so.”

Relevance to the Victorian Charter

Like the Canadian Charter, the Victorian Charter also provides a right to equality (section 8) as well as a mechanism for balancing and limiting rights in certain circumstances (section 7).

A number of VCAT decisions have looked at the circumstances in which the right to equality may be limited. To date, none has specifically considered the role that collective bargaining plays in balancing competing rights and interests. It remains to be seen whether similar arguments will be made, or will be successful, in the Victorian context.

The decision is available online at: http://canlii.ca/en/ca/fca/doc/2012/2012fca209/2012fca209.html

Emma Purdue is a lawyer at Lander & Rogers.