Supreme Court bans dismissal of older workers in public sector

On 1 October 2007, a decision by the Supreme Court declared invalid the articles of the Public Service Act that legally permitted the dismissal of public sector employees aged over 65 years, merely on the basis of their age. Similar articles of the Employment Contracts Act affecting private sector employees were changed more than a year ago.

Background

In February 2006, the Estonian parliament (Riigikogu) abolished the articles of the Employment Contracts Act (Töölepingu seadus) that permitted the dismissal of employees aged over 65 years, solely on the grounds of their age. It was declared that these articles permitting the discrimination of older workers on the basis of their age were in violation of the Estonian Constitution and EU legislation (EE0604029I).

Nevertheless, at the time no changes were made to the Public Service Act (Avaliku teenistuse seadus) which contained similar articles: section 120 of the Public Service Act stipulates that a public sector employee may be released from service due to age when the employee is older than 65 years. Moreover, if the dismissed employee has an employment history of more than five years, the compensation for dismissal based on the employee’s age is smaller than that of regular redundancies. Accordingly, the social protection of older public sector employees decreased considerably after reaching the age of 65 years.

Attempts to change legislation

As early as 2004, the PRAXIS Centre for Policy Studies (Poliitikauuringute Keskus PRAXIS) highlighted in its research on Older workers in the labour market and in working life in Estonia (in English, 521Kb PDF) that the provisions allowing for the dismissal of employees based on their age should be removed from both the Public Service Act and the Employment Contracts Act.

Since the Employment Contracts Act was changed in February 2006, more institutions turned their attention to the need to change the Public Service Act as well. The Chancellor of Justice (Õiguskantsler), Allar Jõks, and the Social Affairs Committee of the Parliament (Riigikogu Sotsiaalkomitee) also pointed out that the Public Service Act is not in accordance with the principle of equal treatment. The Estonian Social Democratic Party (Sotsiaaldemokraatlik Erakond, SDE) initiated a draft act amending the Public Service Act. However, at the time, the draft act did not receive the support of the government.

In 2007, the issue was again placed on the parliament’s agenda. In June, parliament members of the Estonian Centre Party (Eesti Keskerakond) initiated a draft act amending the Public Service Act. In this draft act, the articles that allowed for the dismissal of employees based on their age were excluded. The new coalition government (Eesti Vabariigi Valitsus) of the Estonian Reform Party (Eesti Reformierakond), the Union of Pro Patria and Res Publica (Isamaa ja Res Publica Liit) and SDE supported the initiative and included the amendment of the Public Service Act in their work programme for 2007–2011.

Supreme Court decision

Although the draft act amending the Public Service Act had been proposed, it never came into force. Instead, the provisions – permitting the dismissal of employees aged over 65 years, merely on the basis of their age – were declared invalid by a decision of the Supreme Court (Riigikohus) on 1 October 2007.

The Supreme Court’s decision to declare the articles in the Public Service Act invalid was driven by a dismissal case in the Citizenship and Migration Board (Kodakondsus- ja Migratsiooniamet); in April 2007, two public sector employees were dismissed from the board, based on section 120 of the Public Service Act. Since the dismissal was only based on the age of the employees, the administrative court judged in favour of the dismissed employees. Moreover, since constitutional rights had been violated, a constitutional review proceeding was initiated by the Supreme Court. As a result, the provisions allowing for the dismissal of employees aged over 65 years, based merely on their age, were declared invalid.

After the dismissal case of the Citizenship and Migration Board became public, further similar dismissal cases concerning public sector employees came to light; for instance, the media reported that six public sector employees aged between 65 and 74 years had been dismissed based on their age from the Social Insurance Board (Sotsiaalkindlustusamet, ENSIB), immediately before the decision of the Supreme Court came into force.

Commentary

The cancelled provisions of section 120 of the Public Service Act were also in contradiction with the notion of active ageing, which has become an important issue in Estonia. One of the goals of the [Lisbon Strategy](/search/node/areas OR industrialrelations OR dictionary OR definitions OR definitions OR lisbonstrategy?oldIndex) is to raise the labour force participation of older workers, aged between 55 and 64 years, up to 50%. According to the Progress report on the action plan for growth and jobs 2007 (in Estonian, 524Kb PDF), the labour force participation of older workers in Estonia has reached the Lisbon target, amounting to 58.2% in 2006. Forecasts estimate a labour participation rate of 63.4% among older workers by 2008.

According to statistics from the State Chancellery (Riigikantselei), as at 31 December 2006, some 260 public sector employees were aged over 65 years, thus representing 1.3% of civil servants.

Kirsti Nurmela and Marre Karu, PRAXIS Centre for Policy Studies