Can an employer ever justify discriminating on grounds of age?

In some circumstances, yes. Age discrimination is legal for employers where it is objectively justified. This is a strict test based on EU law. Employers would need to show that their actions were intended to achieve a legitimate aim, and were an appropriate and necessary means of achieving that aim.

For example, in a direct discrimination case, it may be argued that workers over 50 should receive higher redundancy payments for each year of service because of the difficulties that they are likely to face in finding alternative employment. However, it would have to be shown that older workers are more likely than others to be at greater risk of unemployment than other workers and that the higher payments were proportionate to that greater risk.

A salary increment system that awards service of more than 5 years in the same post could well be indirectly discriminatory to younger workers. This is because it is unlikely that it would take someone longer than this to gain sufficient expertise in their role to perform at the highest level.

An employer could attempt to justify such a policy by showing that carrying out the job at the higher level actually required a long period of relevant experience. However, it might be manageable and possible for the company to assess potential capability in other less discriminatory ways, rather than apply an arbitrary length of service filter. In this case the promotion system will be harder to justify.