Introduction

Article 21 of the Charter of Fundamental Rights (CFR) on “Non-discrimination” embraces a positive task for the Member States to eliminate anything which produces unlawful distinctions in society or concrete hurdles towards achieving equality. [1] In 2009, after the entry into force of the Lisbon Treaty, the Charter became a legally binding catalogue of fundamental rights within the EU legal order.[2] The Preamble of Directive 2000/78, at point 6, cites the Charter as a legitimating source for combating discrimination against elderly people. Thus, the relationship between the Charter and Directive 2000/78 on “Equal Treatment in Employment and Occupation” has been understood as a link between ‘legitimacy’ and ‘potency’[3], and it became particularly relevant by virtue of the Charter’s new legal status.

The equality approach embedded in article 21 CFR, which prohibited any discrimination on the basis of the listed grounds, is recalled in article 2 of Directive 2000/78, which defines how the “principle of equal treatment” needs to be interpreted within the boundaries of the Directive and particularly in accordance with article 1.[4] The Directive, however, at article 6 incorporates a contradiction. In fact, article 6 allows certain age discriminations, by considering ‘lawful’ both direct discrimination (when one person is treated less favourably than the other in a comparable situation) and indirect discrimination (an apparently neutral practice which can create disadvantages). According to article 6, such differences can be objectively justified only by a legitimate aim and the means of achieving that aim needs to be appropriate and necessary. Thus, while Article 21 provides a broad but unequivocal legal framework for prohibiting discriminations, articles 2 and 6 of the Directive 2000/78 respectively provide  both the grounds on which discrimination is prohibited and the grounds on which age discrimination can be justified.  Such duality means, Member States often face the uncertainty of what can objectively justify age discrimination.

Two notable Austrian cases, decided by the European Court of Justice (hereinafter: the Court), demonstrate how article 21 CFR and article 6 of Directive 2000/78 should be mitigate by the principle of proportionality, which requires an adequate balance between a rights provision and a state or public interest. The cases are: David Hütter v Technische Universität Graz[5] and Schmitzer v Bundesministerin für Inneres.[6]

Case law

1) The Hütter case and article 6 of Directive 2000/78

According to article 6 of Directive 2000/78, a justification for difference of treatment must be “objective”. This means that it should be supported by a legitimate aim within the context of national law and the means to achieve such legitimate aim must be “appropriate and necessary”. The legitimate aims listed under Article 6 include: legitimate employment policies, labour market and vocational training objectives. Indeed, under article 6, differences of treatment may include “minimum conditions of age… for access to employment or to certain advantages linked to employment”.

Mr Hütter, who worked as a public servant under Austrian law, was entitled to be paid in accordance with the length of his service. However, the law prescribed that the time he had spent working or training before the age of 18 was not to be included in the calculus. Consequently when, Mr Hütter, completed a period of apprenticeship as a laboratory technician with Technische Universität Graz (TUG), he was recruited at a lower incremental pay point compared to a female colleague in materially similar circumstances, but only 22 months older. The age limit imposed by Austrian law (Vertragsbedienstetengesetz ‘the VBG’) determined an unlawful direct discrimination. The TUG argued that the discrimination was justified by legitimate aims: to ensure that those who had pursued a general secondary education would not be treated less favourably than those who had pursued vocational qualifications; and to promote entry into the labour market for young people.

Mr Hütter brought a claim before the Landesgericht für Zivilrechtssachen Graz (Graz Regional Court for Civil Matters). He sought the payment of compensation equivalent to the difference in treatment he had received due to his age. He considered the difference in treatment to be unjustified and in breach of both Austrian Law and Directive 2000/78. That difference in treatment corresponded to a sum of EUR 69.60.  On the possibility to justify the discrimination suffered by Mr Hütter the ECJ (but he took the claim to Graz) expressed the following opinion:

“National legislation which…excludes periods of employment completed before the age of 18 from being taken into account for the purpose of determining the incremental step at which contractual public servants of a Member State are graded, is incompatible with Articles 1, 2 and 6 of Directive 2000/78”.

This declaration motivated a subsequent amendment on Austrian law.

2) The Schmitzer case

The Amending Law apparently solved the incompatibility with Directive 2000/78, by modifying with retroactive effect the wording of Paragraphs 8 and 12 of the GehG (the Law on Salaries of 1956, Gehaltsgesetz) and acknowledging as full work experience the work period before the age of 18. Since then this is now taken into account for the purpose of determining the advancement reference date. Clearly, after the ECJ’s decision in Hütter the financial impact was considerably relevant for the Austrian State. In order to mitigate the financial impact, the Amended Law stated that those who suffered discrimination under the previous system could make an application to switch to the new system. However, in Schmitzer case it was argued that national legislation neutralises the advantage resulting from the inclusion of periods before the age of 18, also placing at a disadvantage only the civil servants disadvantaged by the previous system. In fact, the extension to the periods for the advancement reference date is likely to apply to them alone. Consequently, the adverse effects of the system existing prior to the Amending Law have not ceased entirely for civil servants.

Mr Schmitzer brought an action before the Verwaltungsgerichtshof (Administrative Court), challenging the decision of the Bundesministerin für Inneres which turned down his request for a review of his remuneration status under Paragraph 8 of the GehG, in the version prior to the Amending Law. The Schmitzer case was brought before the ECJ for a Preliminary Ruling which clarified how the “submission of a request by each interested party, as well as those relating to the extension of advancement periods” served “objectives of procedural economy, of respect for acquired rights and of the protection of legitimate expectations”. Mr Schmitzer, had  worked as a civil servant before turning 18,  claimed that the Amending law was still contrary to Directive 2000/78/EC, as it ingrained the effect of the original law. Thus, the ECJ focused on whether this difference in treatment could be justified in the light of article 6.

The Austrian government argued that the legitimate aim pursued by the Amending law was a “budgetary consideration”. The ECJ considered that although budgetary consideration could underpin a social policy of a Member State, it cannot constitute a self-standing legitimate aim within the meaning of article 6. For this reason, such age-based difference in treatment is not objectively justified as appropriate and necessary.

Conclusion

In the Hütter case, the Court recognized Member States’ freedom to determine public measures to promote the integration of young apprentices into the labour market. This freedom is somewhat ambivalent, as it is subjected to the interpretation of the Court. The Austrian policy that did not consider the work experience before the age of 18 was not objectively justified in relation to article 6. The ECJ decision had serious financial consequences for the State, compared to a trivial monetary detriment for Mr Hütter. In the subsequent Schmitzer case, the amendment of Austrian law was still considered to be unlawfully discriminatory as  ‘budgetary considerations’  cannot justify a measure that maintains indefinitely an age-based difference in treatment which was supposed to be eliminated. For this reason, it was not considered “a proportionate means of achieving a legitimate aim”, as required by article 6 of the Directive, although considering “budgetary considerations” as transitional arrangements for age discrimination could instead require a closer consideration by the Court.

[1]     Article 21 of the Charter of Fundamental Rights prohibits any discriminations based on “sex, race, colour, ethnic or social origin, genetic features, language, religion or belief, political or any other opinion, membership of a national minority, property, birth, disability, age or sexual orientation”, reinforcing in this way the link to fundamental or human rights.

[2]                 Francesca Ferraro, Jesús Carmona, “Fundamental Rights in the European Union. The role of the Charter after the Lisbon Treaty”, (2015) EPRS European Parliamentary Research Service. Available online: <http://www.europarl.europa.eu/RegData/etudes/IDAN/2015/554168/EPRS_IDA%282015%29554168_EN.pdf > accessed 21.05.2015

[3]     This is confirmed by the case Kücükdeveci v Swedex GmbH & Co KG [2010] IRLR 346  (concerning employment discrimination) where the Court noted that the Charter have the same legal value as the Treaties, including the horizontal effect

[4]     Article 1 (Purpose) “The purpose of this Directive is to lay down a general framework for combating discrimination on the grounds of religion or belief, disability, age or sexual orientation as regards employment and occupation, with a view to putting into effect in the Member States the principle of equal treatment.”; Article 2 (Concept of discrimination) “ 1. For the purposes of this Directive, the ‘principle of equal treatment’ shall mean that there shall be no direct or indirect discrimination whatsoever on any of the grounds referred to in Article 1”.

[5]               Hütter v Technische Universität Graz [2009] ECR I- 5325 (C-88/08). Judgment of June 18, 2009

[6]                Leopold Schmitzer v Bundesministerin für Inneres [2014] ECR,  Case C-530/13