KEY POINTS:
The Court of Appeal today reversed what was labelled a ground-breaking Employment Court decision which overturned Air New Zealand's policy of automatically demoting captains on their 60th birthdays.
David McAlister, 63, had spent 35 years with Air New Zealand and had been a flight instructor, chief pilot
and pilot in command (PIC).
However, many international pilots are affected by the "Rule of 60": an International Civil Aviation Organisation (ICAO) standard which says pilots cannot hold a command role on a 747 or 767 after they turn 60.
Many countries, including Britain, Australia, Japan and New Zealand opt out of the rule but others such as Hong Kong, Singapore and most importantly the United States (via the Federal Aviation Administration) do not. The prohibition impacts on nearly 90 per cent of Air New Zealand's 747 fleet.
When Mr McAlister turned 60 in 2004 he was informed by Air New Zealand that he could no longer fly "unencumbered" outside of the Tasman and therefore - according to company policy - faced demotion.
Mr McAlister challenged the decision in the Employment Court and won . Judge Coral Shaw sympathised with the airline's position, but said there was evidence Mr McAlister had been treated less favourably than younger pilots with the same qualifications and skills and that constituted discrimination.
Air New Zealand challenged the decision and it was heard in the Court of Appeal in November 2007.
The court found it had been incorrect to compare Mr McAlister's situation with that of a younger pilot.
Referring to the Employment Relations Act 2000, it found the question should have been whether other employees in the same situation would h ave also faced demotion.
To make the comparison the court considered a (hypothetical) pilot who was unable to fly certain routes for a reason other than age, such as an inability to gain a visa.
"If the (airline) would have treated such a pilot in the same way as it treated (Mr McAlister) it cannot be said the respondent has been treated differently on account of his age," the court said.
It found the Employment Court had "erred in law in reaching its conclusion" by making the wrong comparison.
The case was sent back to the Employment Court where it could be heard again "in light of this judgment".
Mr McAlister was required to pay $8000 in costs to Air New Zealand.
From November 2006 the ICAO raised the age limit for pilots to 65, bringing it in line with most countries' mandatory age limits .
- NZPA