Opinion of Mr Advocate General
Mr President,
Members of the Court,
1. Introduction
Mr Arthur Burton is the first to confront the Court with the fact that the principle that men and women should receive equal pay for equal work laid down in Article 119 of the EEC Treaty and put into effect in Council Directive 75/117/EEC logically implies that not only should women enjoy the same benefits as men but conversely that men may not be treated worse than women.
As an employee of the British Railways Board he believes that for that reason he is entitled at 58 years of age to avail himself of the opportunity, which female employees have when they attain 55 years of age, offered by a voluntary redundancy scheme and the benefits which it confers. He submitted an application to that effect in August 1979. However, as a male employee he was not eligible for voluntary redundancy under the relevant rules of British Railways until the age of 60. British Railways therefore rejected his application. To put it somewhat simply, the advantages accompanying voluntary redundancy consisted chiefly but not exclusively in the enjoyment of benefits equal to the pension payable at pensionable age for a maximum period of five years prior to the attainment of that age. Mr Burton complained to an Industrial Tribunal against the decision to refuse to grant him the benefit payable under the voluxntary redundancy scheme. He relied on the Equal Pay Act 1970 as amended by the Sex Discrimination Act 1975. Once it emerged that the Equal Pay Act did not apply because the payments under the voluntary redundancy scheme were non-contractual he based his appeal on the Sex Discrimination Act alone That Act applies to discrimination as regards non-contractual payments, which according to the national court also include voluntary redundancy payments. By virtue of section 6 (4), however, the Act does not apply to provision in relation to pensions. I shall return to that provision of the Act later. The Industrial Tribunal dismissed the complaint, whereupon Mr Burton appealed to the Employment Appeal Tribunal. It was before that tribunal that he claimed that the Sex Discrimination Act must be construed in accordance with Article 119 of the EEC Treaty and Council Directives 75/117/EEC and 78/207/EEC.
The Employment Appeal Tribunal then submitted the following questions of interpretation to the Court under Article 177 of the Treaty:
Written observations have been submitted on those questions in accordance with Article 20 of the Protocol on the Statute of the Court of Justice by Mr Burton, the British Railways Board, the Government of the United Kingdom, the Danish Government and the Commission of the European Communities.
Further matters which it might be useful to mention at this point are that when he made his application in 1979 Mr Burton had worked for British Railways for 42 years and that by virtue of Article 30 of the Transport Act 1962 the British Railways Board is neither a servant nor an agent of the Crown.
At this point I refer to the Report for the Hearing for the rest of the facts and for a summary of the written observations. Where necessary I shall return to the facts and the observations made in the written and oral procedure in the rest of my opinion, which will be constructed as follows: after this introduction I shall first indicate the previous decisions of the Court which may be relevant to this case; that will be followed by a summary of the provisions of the directives relied upon; I shall then analyse the questions submitted in the light of the case-file and the Court's previous decisions; finally, I shall then formulate my opinion on the questions submitted, taking into account the written observations which have been made.
2. The relevant decisions of the Court
2.1. In the first Defrenne judgment (Case 80/70 [1971] ECR 445) the Court ruled that: A retirement pension established within the framework of a social security scheme laid down by legislation does not constitute consideration which the worker receives indirectly in respect of his employment from his employer within the meaning of the second paragraph of Article 119 of the EEC Treaty. That decision makes it desirable for me to examine the relationship between the voluntary redundancy scheme in question and statutory pension schemes. The Government of the United Kingdom in particular bases its view of the case primarily on this relationship, which it considers to be of vital importance. It claims that the relationship affects both the amount and the duration of the voluntary redundancy benefits. Mr Burton however denies that there is such a relationship.
2.2. In the second Defrenne judgment (Case 43/75 [1976] ECR 455) the Court ruled inter alia that: The principle that men and women should receive equal pay, which is laid down by Article 119, may be relied on before the national courts. These courts have a duty to ensure the protection of the rights which that provision vests in individuals, in particular in the case of those forms of discrimination which have their origin in legislative provisions or collective labour agreements, as well as where men and women receive unequal pay for equal work which is carried out in the same establishment or service, whether private or public. That judgment is cited not only by Mr Burton, whose view is supported by the Commission, but also by British Railways and the Government of the United Kingdom, in order to support opposite conclusions. In this regard the term pay and the difference between direct and overt discrimination on the one hand and indirect and disguised discrimination on the other are important in these proceedings. The prohibition of discrimination contained in Article 119 is directly applicable to the first kind of discrimination but not to the second. In later judgments, most recently in Case 96/80 Jenkins [1981] ECR 911, the Court has repeatedly emphasized the significance of this distinction as regards the direct applicability of Article 119.
2.3. In the third Defrenne judgment (Case 149/77 [1978] ECR 1365) the Court ruled that: Article 119 of the EEC Treaty cannot be interpreted as prescribing, in addition to equal pay, equality in respect of the other working conditions applicable to men and women. At the time of the events which form the basis of the main action there was, as regards the relationships between employer and employee under national law, no rule of Community law prohibiting discrimination between men and women in the matter of working conditions other than the requirements as to pay referred to in Article 119 of the Treaty. As regards the events forming the basis of the main action, the question submitted to the Court in that case referred in particular to the age-limit for the termination of a female employee's contract of employment, an age-limit which the contracts of employment of comparable male staff did not contain. Mr Burton and the Government of the United Kingdom cite that judgment to support opposite conclusions. Although the Employment Appeal Tribunal has not raised any explicit question on this point, the difference in age-limits is in fact of crucial importance in this case also, albeit not in the same way as in the third Defrenne judgment. The Commission therefore rightly devotes much attention to this point in its written observations (pages 9 to 13). It believes that the second sentence of that judgment of the Court implies that the decision on the age-limit would have been different if Directive 76/207 had been in force at that time. I shall come back to the details of the Commission's observations concerning the significance of this when I consider the relevant provisions of Directive 76/207.
2.4. The Court's judgment of 29 July 1979 in Case 129/79 McCarthys Limited v Wendy Smith [1980] ECR 1275 concerned unequal ordinary wages and does not appear to be relevant to this case.
2.5. However, the Court's judgment in Case 69/80 Worringham and Humphreys v Lloyds Bank Limited [1981] ECR 767 is relevant to this case. In that judgment the Court ruled inter alia that: A contribution to a retirement benefits scheme which is paid by an employer in the name of employees by means of an addition to the gross salary and which therefore helps to determine the amount of the salary constitutes pay within the meaning of the second paragraph of Article 119 of the EEC Treaty. It appears from that judgment that not all benefits conferred on employees which are related to a pension scheme fall outside the ambit of Article 119 just because they are so related.
2.6. Finally, in Case 96/80 Jenkins v Kingsgate [1981] ECR 911 the Court made it clear that the distinction drawn in the second De fienne ju dgment between overt and disguised discrimination, which is important in determining whether or not Article 119 is directly applicable, does not coincide with a factual distinction between direct discrimination or discrimination in form, on the one hand, and indirect discrimination or discrimination in substance, on the other. The Court put it in the following words :
2.7. The Burton case now before the Court is the first in which questions on the interpretation of directives concerning equal treatment of men and women must also be answered.
3. Some comments on the directives concerning equal treatment of men and women
3.1. The parties to the main action are agreed that Article 1 of Directive 75/117/EEC (Official Journal 1975 L 45, p. 19) has nothing material to add to Article 119 of the Treaty for the purposes of this case. Bearing in mind the Court's earlier decisions on equal treatment, that directive may therefore be ignored.
3.2. That is not the case with Directive 76/207/EEC (Official Journal 1976 L 39, p. 40) on the implementation of the principle of equal treatment for men and women as regards inter alia working conditions. Article 1 explains that the purpose of the directive is to put into effect the principle of equal treatment for men and women as regards working conditions, and Article 2 (1) provides that for the purposes of the following provisions, the principle of equal treatment shall mean that there shall be no discrimination whatsoever on grounds of sex either directly or indirectly by reference in particular to marital or family status. Article 5 (1) of the directive provides that application of the principle of equal treatment with regard to working conditions, including the conditions governing dismissal, means that men and women shall be guaranteed the same conditions without discrimination on grounds of sex. The third question of the employment Appeal Tribunal seeks to ascertain whether, should Article 119 not apply, voluntary redundancy benefits come under the principle, thus defined, of equal treatment for men and women as regards their working conditions.
3.3. Finally Directive 79/7/EEC (Official Journal 1979, L 6, p. 24) on the progressive implementation of the principle of equal treatment for men and women in matters of social security is perhaps indirectly relevant. Referring to Article 1 (2) of the aforementioned Directive 76/207/EEC, which envisages a separate directive on this subject, this third directive, provides inter alia in Article 7 (1) that the directive shall be without prejudice to the right of Member States to exclude from its scope: (a) the determination of pensionable age for the purposes of granting old-age and retirement pensions and the possible consequences thereof for other benefits”.
4. Examination of the questions submitted
In order to answer preliminary questions in a manner useful to the national court it is almost always important to give consideration to the facts relevant to the main dispute. What is more, previous decisions may throw more light on aspects of the questions submitted which require particular attention.
That is certainly true when the national court has framed its questions in very general terms, as in this case. In Question 1 the Employment Appeal Tribunal asks the Court whether a voluntary redundancy benefit, which is paid by an employer to a worker wishing to leave his employment, is within the scope of the principle of equal pay contained in Article 119 of the EEC Treaty and Article 1 of Council Directive 75/117/EEC of 10 February 1975. It appears from the facts forming the basis of the dispute, from the arguments put forward in the written and oral procedure and from the Court's other decisions that as far as such benefits are concerned a distinction must be drawn between their nature and composition or the method of calculating them, on the one hand, and the duration of and access to them, on the other.
The nature and composition or method of calculating the voluntary redundancy benefits in question did not become clear until the oral procedure. The benefits concerned are those referred to in paragraphs 24 and 25 of the document entitled Redundancy, Transfer and Resettlement Arrangements for Railway Staff — Salaried and Conciliation dated 20 September 1978. That document was produced by the Government of the United Kingdom at a late stage in the written procedure after reference was made only to an extract at an earlier stage.
The actual redundancy payments are dealt with in paragraph 24 of the document and comprises:
Paragraph 25 deals with:
Further details of the two schemes are set out in a memorandum of 9 March 1979 agreed on by the British Railways Board and the trade unions. Paragraph 6 of that memorandum states: Staff aged 60/65 (male/female) may leave the service under the Redundancy and Resettlement arrangements when the Function in which [they are] employed has been dealt with under Organization Planning. It follows in particular from that additional stipulation that the different age-limits for access to the payments also apply to the payments referred to in paragraph 24 of the main document. Although we were told at the hearing that the special early retirement pension scheme is no longer at issue, the dispute forming the basis of the reference related both to the payments provided for by paragraph 24 and to those provided for by paragraph 25 of the main document. Since the substantive connexion with pension schemes is especially relevant in the case of the early retirement pension scheme, I shall consider it separately in my opinion.
As regards access to, or the duration of, the payments in question it may be observed first of all that the dispute in fact revolves around this aspect of the voluntary redundancy benefits on which the Court's ruling is sought. Furthermore, the arguments put forward during the written and oral procedure show that the Court's answer on this aspect of the reference need not necessarily be the same as its answer as regards the nature and composition of the payments or the method of calculating them. I refer here in particular to the Commission's arguments.
I have already given a summary of the relevant previous decisions of the Court. In addition to the exception which the Court made in the Defrenne judgment for statutory pension schemes, it seems to me that the exception which the Court made in the third Defrenne judgment for working conditions other than pay is especially important in this case. In the latter judgment the other working conditions also concerned in particular a difference in age-limits for male and female employees. On balance I think that the judgment in the Worringham case is relevant only in so far as it makes the point that not all schemes which are directly related to a pension scheme fall outside the scope of Article 119 for that reason alone.
An answer to Question 1 which draws a careful distinction between the different aspects of the benefit scheme may also affect the Court's answer to Question 2. Unlike Question 1, the wording of Question 2 gives express consideration to the facts of the actual case and thus, in my view, to the age-limit aspect which I have mentioned. For an analysis of Directive 76/207, which is relevant for the purposes of Question 3 (i), I refer to my previous observations on that directive.
With regard to Question 3 (ii), I think, in the first place, that it may be relevant that the question asks, not whether a particular provision of Directive 76/207 has direct effect, but whether the principle of equal treatment contained therein as regards working conditions has direct effect. In using those words perhaps the Employment Appeal Tribunal was indicating that Directive 76/207 might be regarded as putting into effect a generally recognized fundamental or human right. Moreover, since the Commission believes that the question whether the directive has direct effect can be avoided by construing the relevant provisions of the Sex Discrimination Act 1975 in accordance with the directive, I think that it would be useful to cite here the relevant provisions of that Act.
Section 6 (2) of the Sex Discrimination Act reads as follows : It is unlawful for a person, in the case of a woman employed by him at an establishment in Great Britain, to discriminate against her:
Section 6 (4) provides: Subsections (1) (b) and (2) do not apply to provision in relation to death or retirement.
In my opinion those provisions taken on their own are indeed no bar to the solution proposed by the Commission. In my view, too, the question whether other benefits also include voluntary redundancy benefits and the question whether those benefits are related to death or retirement, as referred to here, could certainly both be answered in the light of Community law. In my judgment there is no question here of manifest departure from Community law, as laid down or defined in directives or in the Court's decisions. Even the fact that the section cited at first sight appears to deal only with discrimination against women does not prevent the approach proposed by the Commission from being adopted, for section 2 of the Sex Discrimination Act provides: Section 1, and the provisions of Parts II and III relating to sex discrimination against women, are to be read as applying equally to the treatment of men, and for that purpose shall have effect with such modifications as are requisite.
Section 6 belongs to Part II of the Sex Discrimination Act. Nevertheless in my opinion that solution could only be adopted if the second part of the question raised were reformulated or interpreted to some degree. That reformulation or interpretation might read as follows: If so, may the principle put into effect in the said directive be relied on before the national court applying national legislation intended or partly intended to implement that directive? An answer to the question formed in that way could have regard to the possibility, which emerged during these proceedings, that implementing legislation might depart appreciably from the terms of the relevant directive.
5. Conclusions on the questions submitted
5.1. Question 1: Let me remind the Court that the first question put to it reads: Is a voluntary redundancy benefit, which is paid by an employer to a worker wishing to leave his employment, within the scope of the principle of equal pay contained in Article 119 of the EEC Treaty and Article 1 of Council Directive 75/117/EEC of 10 February 1975? In examining this question I have already indicated that in order for the Court's answer to be of practical help in resolving the dispute in the main action a clear distinction must be drawn in these proceedings between different aspects of the benefit scheme at issue. It has been sufficiently established in the written and oral procedure that all the payments at issue are made directly by the employer to the worker and are mostly for the employer's account. Only in the case of that part of the benefits which is dealt with in paragraph 24 of the relevant scheme can 41% of the expenditure at present be reclaimed from a fund in which employers participate and which is administered by the government.
5.2. Question 2. This question presupposes an affirmative answer to Question 1 and reads as follows : If the answer to Question 1 is in the affirmative, does the principle of equal pay have direct effect in Member States so as to confer enforceable Community rights upon individuals in the circumstances of the present case? Bearing in mind the second Defrenne judgment, the Jenkins judgment and the answer I have proposed to Question 1, I consider that the answer to Question 2 might read as follows:
5.3. Question 3. As my answer to Question 1 is in the negative on the crucial point of the age-limit, I cannot avoid examining Question 3 also. I shall start with the first part of that question, which, I would remind the Court, assumes a negative answer to Question 1 and runs: Is such a voluntary redundancy benefit within the scope of the principle of equal treatment for men and women as regards working conditions contained in Article 1 (1), Article 2 (1) and Article 5 (1) of Council Directive 76/207/EEC of 9 February 1976? It follows from my answer to Question 1 that I should now examine this question solely in relation to the age-limit, for I infer from the third Defrenne judgment that an age-limit which is a condition for the enjoyment of benefits such as those in question cannot as such be regarded as falling under Article 119.
5.4. To sum up therefore I propose that the Court should answer the questions put to it as follows:
1 Translated from the Dutch.