Older workers protected against dismissal

In February 2006, the Estonian parliament amended those articles of the Employment Contracts Act that legally permitted the dismissal of employees aged over 65 years on the basis of their age. Until now, these articles were in violation of the country’s Constitution and of EU legislation which prohibit the discrimination of employees on the grounds of age. Currently, the debate continues in relation to the Public Service Act which also permits age discrimination with respect to dismissals.

On 8 Feburary 2006, the Estonian parliament (Riigikogu) ratified amendments to the Employment Contracts Act, abolishing all articles permitting the discrimination of older workers on the basis of their age. The act, which came into force in 1992 and which has been under discussion for some time ( EE0405103F), permitted the dismissal of employees aged over 65 years, merely on the basis of their age and on being entitled to a pension. In line with the amendments, the Employment Contracts Act protects older workers against dismissals in the same way as it protects all other employees.

Equal treatment of older workers

After having examined the original act, the Chancellor of Justice, Allar Jõks, agreed that providing only limited protection to older workers on the basis of their age is unjustified and violates the Estonian Constitution as well as EU legislation. The Council Directive 2000/78/EC establishes a general framework for equal treatment in employment and occupation and prohibits discrimination on the grounds of racial or ethnic origin, religion, disability, age or sexual orientation. Nonetheless, if the characteristics of a person constitute a genuine and determining occupational requirement, or if there is some other legitimate reason, the directive does provide for a different treatment.

The Chancellor of Justice considered that there was no valid reason for treating older workers differently from younger ones, or for treating pensioners aged over 65 years differently from those aged under 65 years. The Confederation of Estonian Trade Unions (Eesti Ametiühingute Keskliit, EAKL) firmly supported the amendments of the act.

Public Service Act examined

Following the adoption of the amended Employment Contracts Act, attention turned to the dismissal conditions of public service employees set out in the Public Service Act (Avaliku teenistuse seadus). The latter regulates the employment of civil servants and still includes article 120 which permits the dismissal of people on the basis of their age, i.e. after they turn 65 years of age. The Chancellor of Justice and the Ministry of Justice regard these sections of the Public Service Act as being discriminatory and believe that treating civil servants under or over 65 years of age differently is not in accordance with the principle of equal treatment.

The Social Affairs Committee of the Parliament (Riigikogu Sotsiaalkomisjon) urged the government to review the legislation regulating the civil service, in order to highlight those articles that need to be changed or abolished to guarantee equal treatment of all employees.

Commentary

As in many other European countries, the Estonian population is ageing. In 2005, some 17% of its population were aged over 65 years, according to Statistics Estonia (Statistikaamet). Forecasts project an even greater change in the country’s demographics, where the proportion of people aged over 65 years will constitute up to one quarter of the Estonian population. Over the last seven years, the employment rate of people in the 65–69 years age group has continued to increase, reaching 22% (of which 10% are in the 70–74 years age group) in 2005.

Estonia’s employment strategy aims to raise employment levels among older people, as well as develop policies to sustain the participation of older workers in the labour market. The current State Pension Insurance Act provides for the receipt of a salary and pension at the same time, enabling workers to continue working when they become eligible for a pension. The new Employment Contracts Act will also help to increase labour force participation of older workers. Experts consider it as a way of decreasing social expenditure in order to ease budgetary constraints brought about by an ageing population.

Marre Karu, Praxis – Centre for Policy Studies

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