Age Discrimination - Essay Example

RUNNING HEAD: Age Discrimination Age Discrimination BY YOU YOUR ACADEMIC ORGANIZATION HERE HERE HERE OUTLINE Introduction …………………………………………………………………… 4 Corporate Rationale for Discrimination and the Law…………………………. 4 Who is Affected?................................................................................................ 7 Compulsory Retirement – A Case Study………………………………………. 9 Preventing Age Discrimination at Work……………………………………….. 10 Conclusion……………………………………………………………………… 14 REFERENCES APPENDIX Abstract In contemporary society, there is a significant push to provide workplaces which are diverse, including various demographics, lifestyles and work-related skills and knowledge-bases. However, despite this calling toward diversity, there is evidence that age discrimination is occurring at a much faster pace than in recent years despite the existence of a wide variety of legislation which was created to protect the older worker from unequal treatment. Age discrimination, when it occurs, impacts not only the older individual but can leave lasting impacts on the business and broader society. This type of discrimination can take many forms and can surface in many workplace areas. This paper highlights age discrimination, who it affects, where it is likely to surface, the laws constructed to prevent its occurrence, and also illustrates suggestions for today’s HR managers to prevent this form of discrimination from occurring. Age Discrimination Introduction Age discrimination has many definitions, but can be best described as a situation which occurs when older workers are “avoided or excluded in everyday (business) activities because they are simply the wrong age” (Nussbaum, 2000). Age discrimination also involves denying the provision of job opportunities to older workers, such as a career-based promotion, in favor of promoting a younger individual for the management role. Age discrimination, when it occurs, impacts both the more seasoned worker and the business as well. For instance, the older employee who is experiencing discrimination based on age will not only see diminished job opportunities, but their emotional well-being can be impacted negatively. Despite the various legislation created to combat this growing form of discrimination, evidence suggests that age-related bias and discrimination is on the rise in contemporary business and in the broader society. Corporate Rationale for Discrimination and the Law According the Equal Employment Opportunity Commission (EEOC), age-bias claims have soared in recent years, which is attributed to today’s economic conditions (Levitz and Shishkin, 2009). For instance, because many companies are currently looking for methods to reduce costs, lay-offs have become the cost-cutting choice when personnel and payroll costs begin to exceed salary and compensation budgets. In addition, recent changes to existing anti-discrimination laws have made it easier for laid-off employees to allege age bias as the rationale for why they lost their jobs (Levitz and Shishkin). However, why is the older worker being targeted for lay-offs over their younger, less-experienced peers and business colleagues? Many businesses consider replacing older workers with younger employees in order to save costs associated with pension-related compensation and today’s decreasing job wages (Roscigno, Mong, Byron and Tester, 2007). These companies tend to believe that younger workers are cheaper resources, in terms of compensation, and are therefore more valuable for the long-term investment of job promotions or the receipt of on-the-job training (Roscigno, et al). From the hard approach to human resources, employees are often viewed as human capital for achieving long-term strategic goals and are assessed in terms of costs and efficiency. The soft view of HR sees employees as valuable resources who can be developed, coached and mentored in order to achieve their maximum potential. Age discrimination is a hard view of HR in which the older worker is viewed as too old to receive in-depth training and will inevitably be leaving the business as a matter of age-related retirement. This corporate view considers the older worker as, simply, not worth the time and investment to properly train and develop for career positions or job promotion. There is another corporate view of the older worker in which they are stereotyped with the assumption that people over the age of 55 no longer value their contributions to the workplace and will seek retirement as early as humanly possible (Higgins, McReynolds, Hogan and Savickas, 2008). This judgmental view of the older worker also believes that they are no longer flexible or adaptable to modern business needs, are more prone to workplace injury or continuing health problems, and are less agile than their younger colleagues (Higgins, et al). This stereotypical view of the older worker paints a portrait of this group as being inherently lazy and willing to abandon the business in pursuit of their own retirement goals. From the aforementioned hard view of HR, the older worker is viewed primarily as a risk in relation to costs associated with health care and job role inefficiency and is therefore denied similar opportunities as their younger peers and colleagues. Further, some business leaders believe that discrimination against the aged employee reduces risks to the company. For example, companies tend to believe that there are far too many laws in existence which protect the older worker regardless of their productivity levels or individual contribution to business success (Palmore, 2006). Therefore, younger workers who actually do deserve a promotion are being blocked by rules which protect the older worker. Companies who tend to share this conception about the older employee seem to believe that older workers generally demand larger salaries (or sustain them as a matter of years of service and periodic performance evaluations which lead to salary increases). Because of the laws which exist to protect the older employee, businesses with this hard approach to HR would see the older worker as a risk to long-term payroll through which laws tend to guarantee the provision of higher salaries to this older workgroup. The aforementioned business rationale associated with viewing the older worker as a lesser company resource is an illegal form of bias which is protected by various age-related legislation. For instance, there has been a trend in which companies have attempted to remove older employees from the workplace by suggesting they are overqualified for a position. Courts, however, have found that the term overqualified is actually a corporate code word for being too old and is not sustainable logic in the face of anti-ageism law (Mathis and Jackson, 2005). To protect workers from these situations, several laws have been enacted. For instance, the Older Workers Benefit Protection Act of 1990 was an amendment to pre-existing anti-discrimination laws designed to ensure that older workers are treated equally in early retirement or severance situations (Mathis and Jackson). Additionally, just recently, President Obama signed a new equal pay legislation on January 30, 2009, as an amendment to the Age Discrimination in Employment Act, which provides new guidelines to assist older workers in achieving equal workplace status (Davison, 2009). It appears that there are regular updates to pre-existing anti-ageism laws which are produced by a matter of social consciousness and the modern efforts at providing workplaces with diversity. However, despite these laws, companies still continue to rationalize age bias and age discrimination by linking older employees with cost-reduction efforts and minimizing corporate expenditures related to health care service. In today’s business world, where costs can often mean sustaining a competitive advantage over competing firms, age discrimination is likely on the rise as a result of business decision-making and strategy. Who is affected? When older employees feel they have been improperly discriminated against, there are many legal channels available for filing various grievances or lawsuits. When a business has conducted its processes or procedures in a way that is inconsistent with anti-discrimination laws, the costs associated with courts and attorneys, as well as the financial payout for restitution, significantly impacts the companies’ profit margin. However, other than business-related costs, the largest group impacted by age discrimination is the older employee demographic. From a mental health perspective, older adults who perceive themselves as being stereotyped or prejudged in the workplace are at much higher risk of clinical depression and other mental or emotional conditions (Higgins et al). When workers perceive themselves as being viable resources to business success, but cannot find opportunities for promotion or development, they are likely to question their role in society as an older individual. Even though many older workers bring a certain maturity to the workplace and considerable job-related experience, age discrimination can impact their psychological needs related to belonging. Abraham Maslow, a renowned psychologist, developed a hierarchy of needs model which suggests that every person has a five-stage cycle of personal development under a tiered structure. The first tier, physiological needs such as job security and a quality work environment, must be met before the individual can progress toward self-development (Morris and Maisto, 2005). Two of the needs on Maslow’s hierarchy are self-esteem and belonging, which suggests that these needs must also be met in order to be fully productive and contributing to the business (Appendix A). If older workers view themselves as being viable, however they cannot find opportunities as a reward for dedication because of age discrimination, their self-esteem and belonging needs remain unfulfilled. From a psychological perspective, this would impact the employees’ abilities to become fully self-actualized (the pinnacle of self development and improvement). Under this theoretical premise, the older employee would experience depression or other mental conditions simply because of ill-conceived stereotypes about the aging worker which impact their ability to become fully integrated into the company culture. Further, in some situations, it can be the external stakeholder who is impacted by age discrimination. Many companies which trade publicly have shareholders to consider as well as the general public when deciding on relevant business policy. In a situation where a high-ranking business executive is the target of age discrimination, or forced retirement, the business can lose significant strategic experience and knowledge in the process. If the target of age discrimination was a proven strategist, short- and even long-term share value can be potentially affected when changes to the senior-level management hierarchy are imposed without shareholder consent. These situations can also set a precedent for younger members of the workforce where the receipt of company pensions is no longer a viable opportunity in the face of forced retirement simply due to the fact that companies can justify the removal of an older worker to satisfy budget expectations. Compulsory Retirement – A Case Study Interestingly, many of today’s companies still have mandatory retirement policies which highlight a specific age in which the employee must follow compulsory retirement guidelines. Anti-ageism regulations currently establish the age 65 as the minimum age in which compulsory retirement can be legally supported (Williams, 2009). However, a recent survey conducted by the IRS Employment Review, targeting a total of 97 employers, found that only 26 percent of employers surveyed had actually altered their internal practices and policies to comply with age regulations (Williams). This represents a significant divide between legal constructs which protect the older employee and corporate willingness to comply with these anti-discriminatory laws. As the EEOC suggested that age discrimination claims are currently soaring, perhaps these rising statistics can be largely attributed to corporate non-compliance even in the face of changing legislation to protect the older worker. If companies still consider compulsory retirement to be a viable business strategy, businesses will be again impacted in terms of finance when sued by older workers for discriminatory business practices and legal non-compliance. Whelan (2009) offers an interesting legal case, Seldon v Clarkson, which involved compulsory retirement. The firm involved was Clarkson, Wright & Jakes, a solicitor firm, which compulsorily retired its partners when they turned 65. However, Seldon (a partner) decided that he did not want to retire at 65 and entered into a wide variety of talks with the firm’s leadership to take on the role of consultant after his forced dismissal. The firm refused, thus Seldon claimed unlawful age discrimination using the Employment Equality Regulations of 2006 as his defense. The courts found that compulsory retirement, in this job environment, could not apply to partners of the business and Clarkson, Wright & Jakes could offer no substantial evidence that Seldon’s performance was being impacted by age. The end result was Seldon being awarded an undisclosed sum of money. The implications of this important case established specific rights related to partners in businesses and further set the precedent for considering the viability and risks associated with mandatory retirement. This is a positive step for preventing age discrimination in the workplace and for companies which try to use cost-reductions as a justification for denying older employees opportunities. In the case study, Seldon was a high-ranking partner with a very high salary, which made him an obvious target for compulsory retirement in order to remove the high payroll costs associated with his partner position. This case provided the precedent for companies to provide considerable evidence of their decision-making processes related to forced retirement, which would be especially important in today’s economy where businesses are looking for ways to cut costs and the likely target of these cost-reduction efforts is a high-ranking, highly-paid business partner. This is protectionism at its proverbial best. Preventing Age Discrimination at Work Preventing age discrimination through legislation does not appear to be working as expected, which is justified by the rising cases of age discrimination and age-related business bias. With only 26 percent of companies actually taking steps to ensure compliance to age discrimination laws (as identified in the aforementioned survey by IRS Employment Review), compliance appears to be a significant drawback to preserving the rights of the older employee. The first step is to change cultural values in the workplace by not only enacting policies regarding diversity and equal opportunities but by also actively engaging in these behaviors. Thompson (2006) suggests first looking at the culture of the business and identifying whether there is a healthy and diverse cross-section of employee demographics in the business. There should be an assessment of whether certain work groups have an equal representation of different ages or whether a specific department has employees which all fall within a narrow age range (Thompson). The end result is a well-diversified business climate and the removal of risks associated with potential age discrimination lawsuits. Altering the current methodology of recruitment and selection is also another step to preventing age discrimination in the workplace. Human resource managers should periodically observe the line manager during the interview process to ensure they are asking questions which are not age-related or which could be perceived as having age bias associated. If the interviewing manager begins focusing on questions which are not directly related to personal competencies and job skills, changes to the interview question template can be modified by HR personnel (Thompson). The American Associated for Retired People (AARP) offers a set of specific criteria which were outlined by older Americans surveyed by AARP to include respect from co-workers, opportunities to utilize personal talents, opportunities for new learning, and a job which with worthwhile (AARP, 2007). Having an understanding of what drives older worker motivations is key to creating a diverse workforce which meets their unique values and needs as mature workers. It is suggested that a focus group, using a cross-section of different employee age demographics, is a significant method for reducing instances of age discrimination. Differing groups, such as 40-49, 50-64, and 65+, can be recruited for focus groups within the organization to discuss unique job expectations and how best to market to the older employee during recruitment (AARP). Having the data from these focus group sessions can provide meaningful insight into what drives the older, potential employee to seek employment with specific firms and recreate or redevelop existing recruitment strategies. This would be a hands-on methodology for today’s HR professionals which can change not only recruitment efforts, but also give existing mature workers a sense of accomplishment and value through the focus group discussions. Another method of avoiding workplace age discrimination is to offer different options for a phased retirement, rather than making a compulsory retirement policy which sets a specific age for immediate dismissal from the business (AARP). This would theoretically provide workers with a gradual retirement scenario in which they can become accustomed to a reduced schedule or moving into a lower-profile job role during the process. The benefit of this strategy is a win-win scenario for both the business and the more mature worker as it would avoid the risks of misconceptions which could lead to discriminatory lawsuits and also give the soon-to-retire employee an opportunity to remain a valuable asset to the business in the pursuit of satisfying their psychological needs for self-esteem and social belonging. Preventative training is also suggested as a viable tool for preventing age discrimination in the workplace (Ceridian, 2009). This ties in closely to making a positive cultural change in which staff members, managers and HR professionals can take part in interactive training sessions which highlight age discrimination, clearly define its parameters, and offer opportunities for discussion about its workplace implications. This type of session would likely have unlimited opportunities for ensuring that everyone in the business is aware of age discrimination, the risks it poses to the business, and its ability to create negative business cultures. It might also be reinforced that age discrimination can lead more mature workers to depression or diminished self-esteem, which would solidify positive interpersonal relationships between older employees and the rest of the business culture. Making a special HR effort to recruit the more mature worker is another method of changing cultural values and also providing companies with experienced employees. According to Weber (2009) many companies have actually begun retaining older staff members, such as CVS Caremark, a major American drugstore chain. CVS’s current recruitment tactics are seeking baby boomers and other more mature employees. Says Stephen Wing, CVS director of workforce initiatives, “We need their expertise. When you’re in your 50’s and 60’s, you’re in your prime” (Weber, 2009, p.50). For today’s HR professionals looking to prevent or avoid age discrimination in the workplace, they can use CVS’s model of recruitment and take the opportunity to promote this attitude toward the older worker throughout the entire organization. When recruitment tactics involve locating mature top talent, this is another cultural dimension which can reinforce the business’ commitment to utilizing older workers and acclimate the existing staff toward working with a more diverse community of peers and colleagues. Additionally, from a more hard approach to human resources, it is suggested to create a zero tolerance policy regarding age discrimination (Ceridian). Creating policies cannot ensure that all staff members are on-board in relation to recognizing and reducing age discrimination, therefore reinforcing that the company maintains a strong stand on the issue will set the appropriate rewards or punishments necessary if age discrimination is observed or alleged. Using the company’s interoffice communications systems, such as email or intranet, or the company’s bulletin board are good methods of reinforcing the policy and also highlighting that the company leadership will take immediate action in the face of discriminatory behaviors. This is yet another cultural dimension of change which can alter staff and management behaviors through more aggressive HR tactics. There are likely a wide variety of additional tactics and strategies available to prevent age discrimination in the workplace, however by changing cultural values, acting aggressively against the practice through inter-office discussion and training, and assessing older workers’ values related to job role and job expectations are quality methods for reducing ageism in the workplace. The soft approach to HR recognizes the capabilities and psychological needs of the more mature worker and establishes the processes and policies necessary to secure positive perceptions about the company’s role in preventing age discrimination. The long-term impact of the proposed methodologies for avoiding age discrimination will likely be a more unified organizational culture and a more satisfied older worker, therefore they remove risks to the business’ profit margin (by avoiding costly lawsuits) and also satisfy human emotional needs in the older worker demographic. Conclusion Clearly, age discrimination maintains the ability to negatively affect both the mature worker and the business itself, as well as external stakeholders. Despite the laws established to prevent its occurrence, claims of these behaviors are on the rise which should give human resources experts pause to review existing policies to determine whether the business is in strict compliance to anti-discrimination legislation. There seems to be ample opportunities in the workplace for leaders to discriminate against the older worker, both as a means to satisfy budget and profit expectations and also due to misconceptions about the skills and abilities of the older worker. Regardless of the source of age bias, it is clearly a problem which maintains significant long-term impact to the health and well-being of the older worker as well as overall company performance. Fortunately for the more mature worker, legal precedents have been established which minimize the occurrence of compulsory retirement guidelines and also give older workers the opportunity to flex their proverbial mental muscles by becoming more actively involved in the workplace environment. There also seems to be a social shift regarding the value of the mature worker which represents that some positive changes have been made and continue to evolve over time. There are many options available for reducing age discrimination and these options appear to be valid and viable tools for HR managers to ensure that equal treatment genuinely exists in today’s workplaces. References AARP. (2007). “Age Discrimination: What Employers Need to Know”. The American Association for Retired People. Retrieved 29 Mar 2009 from http://assets.aarp.org/www.aarp.org_/articles/money/employers/age_discrimination.pdf Ceridian. (2009). “Age Discrimination: 5 Steps to Avoid Age Discrimination”. Ceridian Corporation. Retrieved 29 Mar 2009 from http://www.ceridian.co.uk/hr/newsletter/nav/1,4813,986,00.html Davison, Linda. (2009). “Fair Pay Law Signed by President Obama”. HR Focus. 86(3): 2. Higgins, M., McReynolds, C., Hogan, E. and Savickas, S. (2008). “Depression and the Elder Person: The Enigma of Misconceptions, Stigma and Treatment”. Journal of Mental Health Counseling, Alexandria. 30(4): 283-291. Retrieved 30 Mar 2009 from www.proquest.com Levitz, Jennifer and Shishkin, Philip. (2009). “More Workers Cite Age Bias After Layoffs”. Wall Street Journal, New York, NY. 11 Mar: D.1. Mathis, R. and Jackson, J. (2005). Human Resource Management, 10th ed. Thomson South- Western. Morris, Charles G. and Maisto, Albert A. (2005). Psychology: An Introduction. 12th ed. Pearson Prentice Hall: 384-386. Nussbaum, Jon F. (2000). Communication and Aging: LEA’s Communication Series. Mahwah, N.J., Lawrence Erlbaum Associates, Inc: 14-16. Palmore, Erdman. (2006). “Is Age Discrimination Bad?”. The Gerontologist, Washington. 46(6): 848-851. Retrieved 29 Mar 2009 from www.proquest.com Roscigno, V., Mong, S., Byron, R. and Tester, G. (2007). “Age Discrimination, Social Closure and Employment”. Social Forces, Chapel Hill. 86(1): 313-335. Thompson, Steve. (2006). “Avoiding Age Discrimination in the Workplace”. Associated Content: Business and Finance Division. Retrieved 28 Mar 2009 from http://www.associatedcontent.com/article/59656/avoiding_age_discrimination_in_the.html?cat=3 Weber, Joseph. (2009). “This Time, Old Hands Keep their Jobs”. Business Week, New York. Iss. 4118: 50. Whelan, Matthew. (2009). “Case of the week”. Personnel Today, Sutton. 10 Feb: 11. Williams, Nadia. (2009). “Age discrimination laws help staff work longer”. Personnel Today. Sutton. 20 Jan: 43. Appendix A: Psychological Model of Basic Human Needs as Applied to a Workplace Organization Read More