Diversity Insight

Employers Seeking Savings Can’t Afford Age Claims

The Equal Employment Opportunity Commission (EEOC) recently heard testimony on the particular effects the economic downturn has had on older workers, addressing the unfortunate possibility that the recession may be serving as a catalyst for some employers to engage in age discrimination.

Recession Hits Older Workers

During a mid-November EEOC meeting, several experts reported on the difficulty age discrimination poses to older workers’ efforts to maintain or seek employment. One U.S. Department of Labor expert testified that the rate of unemployment for people over age 55 has more than doubled in the past three years, marking that time as the longest period of high unemployment that many workers in this age group have ever experienced.

Once unemployed, older workers spend more time searching for work and are jobless for longer periods of time when compared to workers under age 55. According to the U.S. Bureau of Labor Statistics (BLS), in February 2010, workers over age 55 experienced an average unemployment duration of almost nine months, compared to less than six months for employees under age 24 and just over seven months for those aged 25 to 54.

Following the commission meeting, a related EEOC press release noted that during the 2009 fiscal year, almost one quarter of the charges filed with the agency were age discrimination claims. EEOC complaints that included an age discrimination claim rose 28 percent from 19,103 in 2007 to 24,582 in 2008.

Don’t Let Your “Old Guard” Down

Without a doubt, age discrimination claims are on the rise, though this increase is arguably the result of a number of different contributing factors. First, there are simply more workers ― and more older workers ― in the American workforce. The BLS predicts that the number of workers between the ages of 65 and 74 will grow by more than 80 percent between 2006 and 2016. And as the average age of workers continues to increase, so does the number of potential age discrimination plaintiffs.

Additionally, the workers we do have are working longer, well past the commonly expected retirement age of 65. A portion of this continued work may be explained by the substantial financial hits many near-retirees took to their retirement accounts, forcing them to continue working past their previously planned retirement ages to meet basic income needs. Further, as employers have moved away from defined-benefit retirement plans, instead opting for defined-contribution benefit plans that shift more responsibility for retirement savings to the employee, some workers’ savings efforts may simply not be adequate for them to retire at the usual 65-year benchmark. Increased life expectancy adds another hurdle to the anemic retirement accounts for these workers.

Meanwhile, employers suffer because age discrimination claims aren’t the source of the same level of media attention that race and gender discrimination claims receive. As a result, employers may be unfamiliar with the perils of age discrimination, opting to replace older workers with “fresh blood” based on stereotypical and discriminatory beliefs about their efficacy and adaptability.

Know the Basics

Following the testimony at the EEOC meeting, Commissioner Stuart Ishimaru responded by vowing vigilant protection for older workers and identifying a potential enforcement priority for the commission. As a result, you must especially understand and respect the legal rights of older workers. Otherwise, you will find yourself at the wrong end of a potentially expensive discrimination claim.

The federal Age Discrimination in Employment Act of 1967 (ADEA) makes it unlawful to discriminate against persons 40 or over with respect to the terms and conditions of their employment. The law has no cap, so all employees above age 40 are protected. The ADEA applies to employers with 20 or more employees for each workday in at least 20 calendar weeks in the current or previous calendar year. State age discrimination laws may also offer protection at a lower age or employee threshold. The Older Workers Benefit Protection Act amended the ADEA to specifically prohibit employers from discriminating against older workers in the denial of benefits.

Age, like other protected worker classifications, may be the basis of a harassment claim. Although the U.S. Supreme Court hasn’t ruled on whether an employee can sue for age harassment under the ADEA, some federal appellate courts have found that such a claim does exist. Age harassment claims tend to arise because of an employer’s age-biased comments ― comments such as looking for “new blood” or weeding out the “old guard” ― or tolerance for similar coworker comments. The comments then are offered as proof that a worker’s age was the motivation for an adverse job action.

As is the case with other forms of discrimination, employees who file or assist with claims under the ADEA are protected from retaliation as a result of the filing. You may be able to defend against an age discrimination case if you can show the employment decision was based on a “reasonable factor other than age.” Thus, you may still discharge or discipline an older worker for good cause, such as poor job performance or misconduct. However, proper documentation of the reason for the decision is crucial.