The average compensation awarded in successful age discrimination cases has increased by 624 percent in the past year, reaching £103,000.
This is up from £14,000 in 2022/23 and the highest average award for age discrimination claims since at least 2007/08, according to employment and partnership law specialists Fox & Partners.
The rise in payouts is largely driven by a number of high-value cases involving senior professionals, with high-profile rulings in recent years. In 2020, a former Citibank employee received £2.7 million in compensation after being referred to as “old” before his employment was terminated.
Similarly, a senior executive at FTSE 250 firm Vesuvius was awarded £3.2 million after being called an “old fossil” who “did not know how to deal with millennials” when the company decided against hiring anyone over 45.
Despite the huge increase in compensation, the number of age discrimination cases that proceed through an employment tribunal remains relatively low. In the past year, 12 cases resulted in tribunal-awarded compensation, down from 16 in 2022/23. Many claims are settled before reaching a tribunal.
Age Discrimination Claims May Rise in Near Future
Fox & Partners warns that as the UK’s population ages, age discrimination claims may become more common. Employers are advised to address potential risks, including ageist stereotypes and workplace ‘banter’ that could contribute to discrimination claims.
Ivor Adair, Partner at Fox & Partners, commented, “The average value of age discrimination awards has notably climbed in the past year – this should serve as a stark warning to employers. Increasing numbers of older workers believe their age puts them at a disadvantage in securing a new role and losses for senior executives who claim their lucrative careers have been cut short can be significant.
“With an ageing population and a growing awareness of high-profile disputes, high-value age discrimination claims could well become more frequent in the coming years.”
Employers are encouraged to review workplace policies to ensure effective anti-discrimination measures are in place. A proactive approach can help create a more inclusive environment while reducing the likelihood of costly litigation. Adair also noted the challenges surrounding succession planning, particularly in board-level roles. Poorly managed transitions can increase the risk of age discrimination claims.
Some organisations still enforce a mandatory retirement age, which can be legally risky if not based on clear consultation, evidence or business justification. One recent example was that of Leeds law firm Walker Morris LLP. The firm lost an age discrimination case brought on by senior partner Martin Scott. The firm had dismissed Scott due to a mandatory retirement policy, but failed to provide any proof of its assertion that partner performance declines with age.
