Combatting age discrimination: the role for employers and in-house lawyers

Age discrimination, it would appear, is still rife despite the obvious business and legal reasons for stamping it out. Lucy Trevelyan considers where ageism stems from, what can be done to minimise it in the workplace and what role in-house lawyers need to play. 

With an increasingly ageing workforce and with many countries introducing tough laws to combat age discrimination, it would seem sensible for employers to introduce strategies to combat ageism and get the most out of workers old and young. However, a recent survey by the United Kingdom’s Centre for Ageing Better found that just one in five employers were discussing the ageing workforce strategically and nearly a quarter (24 per cent) are unprepared for a growing number of older workers. Meanwhile, the Centre’s research also reveals that 32 per cent of employees believe they have been turned down for a job because of their age.

Reasons for age discrimination

Bias against ageing operates powerfully at a subconscious level, says Patrick L Benaroche, Vice Chair of the IBA Employment and Industrial Relations Law Committee and a partner at Stikeman Elliott LLP in Montréal, with the mere fact of using words like ‘old’ or ‘aged’ eliciting negative reactions.

‘There is a stereotype that ageing people have declining cognitive capability and memory,’ he says. ‘There seems to be both explicit and implicit bias against aging people. The feeling that discrimination against older workers is just natural, is a widespread phenomenon. People do not believe that this bias is unjust.’

Stereotyping – making assumptions about job applicants’ and employees’ capabilities because of their age – is one of the most common causes of age discrimination, agrees Sarah Ozanne, of counsel in the employment team at CMS, London. ‘Stereotyping may impact the diversity within and efficiency of a business. More initiatives could focus on ways in which stereotyping is made in the first place and how this can be consciously avoided,’ she says.

It is not unusual for older employees to falsify their resumé to avoid highlighting their age, Benaroche says. ‘Similarly, stereotypes [about] the behaviour patterns of millennials can lead to discrimination against younger workers. Thus, while we have rules seeking to prevent discrimination on the basis of age, the prejudicial attitude of individuals may nonetheless persist, whether conscious or not.’

Unemployed older employees in Spain commonly have difficulties in getting a new job, says César Navarro, Head of the Employment and Pensions department at CMS, Madrid. ‘One reason for this is that, in broad terms, employers find it much more attractive to hire young employees who are more pliable to their interests and working ways and, in some cases, these young employees trigger lower employment-related costs than older ones.’

It would be interesting, he says, considering the problems that older employees normally face, to implement measures relating to the two problems. ‘These measures could reduce the difficulties in finding a job for [aged] employees (training programmes, state aid to employers hiring aged employees, etc), and help aged employees to maintain their jobs.’

Leading jurisdictions

France, the UK and the United States are among the jurisdictions seen to be leading the way in tackling age discrimination, says Selvamalar Alagaratnam, Senior Vice Chair of the IBA Employment and Industrial Relations Law Committee and partner at Skrine, with France even criminalising the act of age discrimination.

The UK’s Equality Act 2010 (EqA 2010) does provide reasonably wide protection from age discrimination, says Ozanne, protecting job applicants, employees and workers from both direct and indirect discrimination, harassment and victimisation on the grounds of age.

Loopholes are, however, available: age discrimination is permitted in limited circumstances, including statutory redundancy payment calculations, insurance benefits and the national minimum wage. And unlike other protected characteristics under the Act, direct discrimination can be objectively justified on the grounds of social policy aims. Indirect discrimination can also be objectively justified on the grounds of a real business need.

The seminal case of Seldon v Clarkson Wright and Jakes [2012] UKSC 16 clarifies various key points in this area including what constitutes a social policy objective – which is a difficult concept to define – and how such tests may be satisfied by an employer, says Ozanne. ‘The government is given a wider margin of discretion than a private sector employer. But no entity – neither private nor public – has an entirely free hand. The employer still needs to be able to justify its position.’

What remains unclear is the extent to which cost can be relied upon as a justification, says Yvonne Gallagher, partner in the employment team at Harbottle & Lewis, London. ‘There is a history of the courts permitting reliance on cost only if it accompanies another justifying factor but there are also indications that cost might more readily be accepted as a justification in the context of age discrimination than, for example, in relation to race or sex discrimination.’

Despite the apparent robustness of the UK law, according to recent guidance from the Advisory, Conciliation and Arbitration Service (Acas) – which aims to support employers in preventing unfair treatment at work and eradicating bias against older and younger workers – age discrimination is one of the most common forms of unfair treatment at work, with both younger and older employees having experienced discrimination based on their age.

The new Acas guidance, says Ozanne, highlights the need for an employer to set out what experience and skills are required for a role as part of their recruitment process, rather than demanding an exact number of years’ experience. ‘The core Acas guidance is accompanied by a set of useful tips for employers and some myth-busting facts in this area. For example, research suggests absence rates are similar across all age groups and the assumption that older employers are more difficult to train is dismissed.’

Unlike in the UK, the federal age discrimination laws in the US protect only those aged 40 and older. ‘No matter how much a role age plays in employment decisions for younger workers, they are not protected by statute,’ says Laura Lawless Robertson, partner at Squire Patton Boggs, Phoenix. And indeed, a recent ruling by the US Appeals Court reveals the restrictive nature of the US’ age discrimination laws, confirming as it does that they do not even apply to older external candidates – only actual employees.
The prevalence of ageism in the US is illustrated by the stats: in 2017, claimants filed 18,376 charges with the Equal Employment Opportunity Commission alleging age discrimination. And as Robertson points out, this number does not include the likely tens of thousands of charges filed with state agencies.

Affected industries

Although age discrimination is a concern in all industries, there are some fields in which anecdotal evidence suggests a heightened cause for concern, Robertson says.

‘For example, in sales, particularly in high-tech sales, there remain pervasive stereotypes about the ability of older workers to be aggressive, technically savvy and able to withstand extensive travel,’ she notes.

‘There are also industries that are becoming increasingly automated, such as manufacturing. Where reductions in force are implemented, older workers who lack skills and cross-training to be transferred to more in-demand areas of the business are susceptible to layoff, with the concurrent risk of disparate impact claims alleged against the company,’ adds Robertson.

It has been suggested that tech start-ups can often treat older people differently and worse than younger colleagues when they apply for jobs or internal promotion, says Ozanne. ‘This is despite the fact that programming knowledge has been found to improve with age. And many believe ageism at work may well start at a younger age for women than it does for men.’

Robust regulation

Although a country can have strong age discrimination laws, their effectiveness, it appears, will generally come down to the willingness of the responsible regulatory body to rigorously enforce them.

Even in the UK, where the anti-ageism laws are recognised as strong, a recent Women and Equalities select committee report concluded that the Equality and Human Rights Commission (EHRC) and the UK government was failing to enforce the law on age discrimination and needed to be clearer that prejudice, unconscious bias and casual ageism in the workplace were all unlawful under EqA 2010.

In Canada, says Benaroche, although laws in this area are quite robust and vigorously enforced when complaints are brought forward, unless organisations deliberately intend to comply with the law, the provisions which prohibit age discrimination in themselves are not very onerous at all.

‘It is relatively easy, and common, for employers to invoke a variety of reasons for refusing to hire an employee, as a pretext, to avoid a claim of age-related discrimination. Discrimination based on age remains notoriously difficult to prove as a result,’ he says.

In 2015, a survey by human resources consulting firm Randstad found that 26 per cent of Canadians said they experienced age-based discrimination at work. This, says Benaroche, places Canada near the middle of the pack of the 44 countries surveyed. Canada is placed somewhere between India, where 56 per cent of respondents said they experienced age discrimination at work, and Sweden, where only 13 per cent reported it.

No legislation

In countries such as Malaysia where this is no specific legislation to protect citizens against age discrimination, ageism in a work context is likely to be rife, says Alagaratnam.

‘Studies by the Malaysian Research Institute on Ageing – MyAgeing – have reportedly found that the HR departments of some companies were reluctant to employ senior citizens and when advertising vacancies, there were job advertisements which blatantly specified that candidates should be aged below 40. There were even company officials who admitted that the objective of MyAgeing went against their own company’s human resource philosophy of discontinuing the services of their older workers.’

While there are no specific age discrimination laws in Malaysia, there are other labour laws that provide for the security of the tenure of employees, including that the employee cannot be dismissed without just cause or excuse (the Industrial Relations Act 1967) and that an employee cannot be terminated on the grounds of age before the employee attains the minimum retirement age (the Minimum Retirement Age Act 2012).

Since the ‘MyAgeing’ initiative was launched in 2015, with the objective of driving innovations addressing the challenges of old age and ageing in Malaysia and South East Asia, there have been more calls to address the issue of ageism in the workplace, says Alagaratnam.

However, she says, in the recent proposals to amend the Employment Act 1955 the prohibitions against discrimination in pre-employment and employment appear to be limited to gender, religion, race, disability, language, marital status and pregnancy, but not age.

Steps to tackle age discrimination

Businesses, Benaroche says, must take concrete steps to reduce subjectivity in hiring, promotion and evaluation processes. ‘They can do so by establishing standardised metrics and creating a transparent process for promoting employees. They can also performance manage all employees on a regular basis and not just as they approach the end of their career. Employers need to have mission statements and an organisational culture that values older workers, respects their rights and promotes inter-generational sensitivity in the workplace.’

From a legal perspective, he says, recourses already exist which allow employees to be reinstated at work if they believe they have been the victim of ageism. ‘This can be a powerful remedy.’

To ensure age discrimination laws are adhered to, employers should focus on competency and skill-based assessments when recruiting, appraising and otherwise assessing staff, says Claire Brook, employment law partner at Aaron & Partners LLP, Chester.

‘Employers should provide training to managers, senior staff and directors on equality and diversity and dignity and respect in the workplace (to cover all protected characteristics including age),’ says Brook. ‘Further, employers must make sure they have appropriate policies and ensure the workforce is aware of its obligations. Any policies that may be discriminatory should be reviewed and [an employer should] seek advice if [they] identify a potential discriminatory impact.’

When recruiting team members, human resources departments should cast a wide net, not only recruiting at colleges and universities where the labour pool is likely to be younger, but also through online and print advertisements and career fairs, Robertson says. She adds that performance appraisal forms should be reviewed to ensure objective as well as subjective criteria are considered during the performance management process.

‘Employers should consider the structure of their organisations and think creatively to facilitate new roles for older members of staff. Genuine intergenerational integration has considerable potential to unlock increased productivity, morale and stability in a company’s workforce,’ she adds.

It is important to avoid judging job applicants solely on their length of experience, as this will be indirectly age discriminatory against younger people, says Ozanne. ‘Instead assess each applicant’s type and breadth of experience, together with their knowledge, skills and abilities. Employers should aim to base promotion decisions on ability or potential to do a job rather than age. It is also important to ensure that any redundancy selection criteria take into account the need to avoid age discrimination.’

Employers should consider conducting an audit of the benefits and/or awards available to staff; of termination clauses within employment contracts and related company policies; and of any other company policies (eg, for retirement) that contain age-related provisions, she says.

‘Such an audit provides an employer with the opportunity to consider any relevant terms through the lens of age discrimination, and to test if such terms are still required and if so why, or whether they can be amended or removed. For example, is it absolutely necessary for a hard retirement age to be in place or could more flexibility be provided? A thorough analysis is both good practice and is likely to strengthen an employer’s ability to illustrate its rationale behind any relevant documentation or procedure should it face future claims.’

The role of the in-house lawyer

The role of in-house lawyers, says Benaroche, is to act as the watchdog for the organisation that they represent, to make sure that a proper policy is in place that fosters an environment that focuses on the abilities of workers and not on their age. ‘It is also their job to make sure that this policy is uniformly and consistently applied within the organisation. Not only will this keep the company away from legal trouble, but it will also promote a more diverse workforce that is both creative and productive.’

In-house lawyers should assist the board in understanding its duties to staff, keep companies up to date on their obligations, provide guidance for learning and development teams and ensure they are given the right level of training and ensure that both employees contracts and staff policies are up to date with current legislation by way of regular reviews of the documents, Brook says. ‘It is also the role of in-house lawyers to remind companies that discrimination law is not limited to staff, but [in the UK] also encompasses other areas such access to services and education under EqA 2010.’

Robertson says in-house or outside counsel should be called upon to review job postings to ensure that buzzwords that are code for seeking younger workers are avoided. ‘“Flexibility”, “nimble-mindedness”, “recent college graduate”, “youthful”, “energetic” and similar descriptors are often consider buzzwords for preferring younger candidates over older ones. Employers should avoid qualifications that are metaphors for youthfulness.’

HR professionals should be careful to scrutinise hiring managers’ preferences to be sure they are not code for preferring younger candidates and should also be sure that objective job performance metrics are included when selecting candidates for reduction, she says. ‘Outside counsel can assist with statistical analyses to ensure that older workers are not selected at a disproportionate rate over younger workers with similar skills and performance.’

Robertson suggests that decision makers, when recommending the termination of an older worker’s employment, should review their recommendations with an HR representative or counsel in advance to ensure that a legitimate, business-related reason is the impetus for the termination.

‘Any reduction in force planning should be vetted by counsel, both during the creation of criteria for selection, in the preparation of talking points for downsizing discussions and in the drafting of separation agreements to ensure that releases of age claims are valid and enforceable,’ she adds.