(CN) - Hungary discriminates against older workers in the justice system by forcing them to retire at age 62, the Court of Justice of the European Union ruled Tuesday.
Hungarian lawmakers lowered the retirement age for judges, prosecutors and notaries from 70 to 62 in 2011. The bill ostensibly standardized public-sector retirement across Hungary and - legislators hoped - would give young lawyers easier entry into the legal profession.
The new law forced the June 30 retirement of Hungarian judges and prosecutors aged 62 and older prior to Jan. 1, 2012. Those reaching age 62 this year must retire on Dec. 31.
The European Commission filed suit, claiming the rapid and radical lowering of the mandatory retirement age constituted age-related discrimination and violated the EU's equal employment treatment laws. In expedited proceedings, the high court in Luxembourg agreed.
"The disputed national measures, pursuant to which the fact that a worker has reached the retirement age laid down by that legislation leads to automatic termination of his employment contract, must be regarded as directly imposing less favorable treatment of workers who have reached that age as compared with all other persons in the labor force," according to the decision. "Such legislation therefore establishes a difference in treatment directly based on age."
While Hungary's social policy objectives may justify some derogation of EU law, the abrupt and significant lowering of the retirement age - without transitional measures - infringes workers' expectations, thus leaving them unprepared to face early retirement, the court said.
"In those circumstances, the persons concerned are obliged to leave the labor market automatically and definitively without having had the time to take the measures, in particular measures of an economic and financial nature, that such a situation calls for, in light of the fact that, firstly, their retirement pension will be, as was stated during the hearing, at least 30 percent lower than their remuneration and, secondly, the cessation of functions does not take into account contribution periods, which does not therefore guarantee the right to a pension at the full rate," the ruling states. "It must be stated that Hungary has failed to provide any evidence to enable it to be established that more lenient provisions would not have made it possible to achieve the objective at issue."
Europe's highest court also rejected Hungary's argument that the new scheme included "notice periods," and that workers anticipated changes in their retirements when the law passed in 2011.
"Even supposing that those notice periods might have sufficed to avoid all prejudice to the persons concerned, it is necessary to point out that Hungary has in no way explained that the contested legislation enabled the judges, prosecutors and notaries to anticipate with a sufficient degree of certainty the amendments to their retirement scheme contemplated and to take the necessary measures," the court said.
While the legislation might open up the legal profession to young professionals in the near future, the gains will be short-lived, according to the ruling.
"While, in 2012, the turnover of personnel in the professions concerned will be subject to a very significant acceleration due to the fact that eight age groups will be replaced by one single age group, namely that of 2012, that turnover rate will be subject to an equally radical slowing-down in 2013 when only one age group will have to be replaced," the judges wrote. "In addition, that rate of turnover will slow down progressively as the age-limit for compulsory retirement is raised progressively from 62 to 65 ... leading, in fact, to a deterioration in the prospects for young lawyers of entering the professions of the judicial system. It follows that the provisions at issue are not appropriate to achieve the objective of establishing a more balanced 'age structure.'"
The Hungarian Constitutional Court retroactively repealed much of the contested action on its own earlier this year, likely mooting the court's directive for the country to immediately fix its legislation or face additional noncompliance proceedings from the European Commission.
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