CIPD - Age and employment

Diversity and equality

Revised October 2009

This factsheet gives broad introductory guidance. It:

covers what age discrimination is and why it is bad for people, business and society
outlines the legal background to tackle it
offers recommendations about good employment practice and an action plan to effect change
includes the CIPD viewpoint.

What is age discrimination?

Age discrimination happens when someone is unfairly disadvantaged for reasons related to their age which cannot be objectively justified.

It can:

affect anybody regardless of how old they are
adversely affect employment opportunities, especially those of older people and younger people
result in failure to consider personal abilities, potential and experience in employment and training decisions
incur expensive legal costs and penalties for employers when legal claims against them are successful.

Our survey Tackling age discrimination in the workplace carried out before the 2006 age regulations to protect people against age discrimination came into force, found that age discrimination was a significant problem in the workplace with 59% of respondents saying they had been disadvantaged because of their age.

See the survey report

Statistics from the Employment Tribunal Service show that in the first six months following the 2006 age regulations, 972 age discrimination claims were presented in tribunals. In 2007/8, 2,949 claims were made and in 2008/9 the figure was 3801.

The legal background

The Employment Equality (Age) Regulations 2006 came into force in October 2006 to comply with the European Equal Treatment Framework Directive (2000/78/EC). These regulations make age discrimination in employment unlawful. The UK legislation protects and protects people of all ages in employment. Direct and indirect discrimination, victimisation and harassment are covered in all aspects of employment including unfair dismissal and redundancy provisions.

Some key points:

The regulations protect people of all ages in employment and regarding recruitment, promotion, reward and recognition and redundancy and vocational training.
The regulations apply to all employers, and providers of vocational training, trade unions, professional associations, employer organisations and trustees, and managers of occupational pension schemes.
Goods, facilities and services are not covered but the Equality Bill 2009 will extend protection to access to goods and services.
A national default retirement age of 65 makes compulsory retirement lawful providing an employer follows the process set out in law. Following the September 2009 decision in the ‘Heyday’ EU level legal challenge, this default retirement age remains lawful, but its long term future will be reviewed by the Government in 2010 - one year earlier than planned when the age regulations were introduced.
All employees have the ‘right to request’ to work beyond the default retirement age of 65 (or any ‘normal’ retirement age set by the organisation) but employers are not legally obliged to give reasons for the decisions they make not to respond positively to such requests. They must, however, give advance notice of an approaching planned retirement date and must follow the ‘duty to consider’ default retirement process diligently to defend decisions successfully if legally challenged.
Occupational pensions are covered by the regulations, as are employer contributions to personal pensions although, generally, the way in which pension schemes work is not affected.
The regulations do not affect state pensions.

Other important points include:

Direct and indirect age discrimination can be justified if the treatment or provision, criterion or practice in question is a proportionate means of achieving a legitimate aim, although employers will find it difficult to do this. (Only indirect discrimination can be justified in other discrimination legislation).
Length of service requirements for employment benefits practices of five years or less are legal.
Length of service requirements for employment benefits practices of periods longer than five years may also be justifiable if the employer can show that they have awarded the benefit to reward loyalty, to encourage motivation, or to recognise the experience of a worker.
In 2010, the default retirement age will be reviewed by the Government to consider whether it is still necessary to maintain a default retirement age at 65, or any at all.
Amendments are incorporated into the Employment Rights Act 1996 so that dismissal at a justified retirement age (usually 65) in specified circumstances will be a potentially fair reason for dismissal.

In June 1999 the Government published a voluntary Code of Practice Age diversity in employment¹ together with implementation guidance and case studies to show how employers have tackled age discrimination. This Code sets out good practice principles to adopt in recruitment, selection, promotion, training and development, redundancy and retirement and reflects the advice given in this factsheet.

Acas provides advice and guidance on age and employment issues, but the Equality and Human Rights Commission (EHRC) has responsibility for all equality and diversity issues.

CIPD members can find further information about the age regulations and employers’ legal duties regarding retirement in our Age discrimination and retirement FAQ in the Employment Law at Work area of our website.

Go to the Age discrimination and retirement FAQ

The business case

It has been estimated that age discrimination costs the UK economy billions of pounds (over £31 billion a year), but increasingly evidence shows that older people are interested in working beyond normal retirement ages and employers are positive about retaining them.

Background facts

Demographic changes are altering the proportions of younger and older people in the population with an increasing proportion of older people and a shrinking proportion of younger people. This is because more people are living longer and the birth rate is below replacement level.
These dramatic changes are seriously affecting market place opportunities for goods and services and the labour market available to employers. They demand attitudinal change about fundamental issues such as the provision of goods and services, retirement and working policies and practices.
Age prejudice and stereotyping is known to inform the ways in which people of all ages have access to jobs, training - as well as goods and service - causing disadvantage to people, organisations of all kinds and society in many ways.
Recognising this, many employers choose to change the way they operate to remove barriers to sustaining business performance and do more than meet the minimum required by law to remove age discrimination.

Evidence disproves many age stereotypes

Examples are:

Perceptions about older people having more sickness absence than younger colleagues are ill founded.
Older workers stay in their jobs longer than younger people.
Age discrimination damages people by causing under-achievement, reduced self-confidence and motivation, lower self-esteem and loss of personal income and status.
Findings from many studies show that younger and older workers are on average equally effective in their work.
Research shows that, given the right training, older people are just as capable of learning new skills as younger people.

Already, many people choose to work beyond state pension age and the Government wants to encourage more older workers to do so, to maintain the ratio of workers to non-workers in the economy. Various surveys show that there is a keen appetite amongst older employees for flexible working and flexible pensions and the activity levels of older people continues to show an increase, even in the recession, and is expected to continue to rise.

Recommendations for employers

Employers need to ensure they are not vulnerable to legal claims by checking that all their policies and procedures are in line with the requirements of the age regulations and to improve business efficiency and effectiveness.

Age discrimination is a pervasive issue and the challenges of tackling it and ‘age proofing’ employment policies and practices are complex and take time. All those involved in making decisions about the employment and training of people should understand the implications of age-stereotyping to improve talent management.

Recruitment and selection

Age, age-related criteria or age ranges should not be used in advertisements except to encourage applications from age groups which do not usually apply. While such forms of encouragement through positive action are lawful, positive discrimination is not and employers need to make sure they treat everyone fairly regardless of their age especially when trying to redress imbalances in the average age of their workforces.

While age should never be taken into account in employment decisions, age details are needed by employers for a variety of reasons including, for example, workforce monitoring. However, monitoring information can be asked for in a ‘tear-off’ section of an application form to make sure it is not used inappropriately in the selection process.

Interviewers and those concerned with selection must be trained to make sure they understand what causes age discrimination and how to avoid it so they make recruitment decisions based on objective criteria relevant to the job and personal merit.

Medical advice

A person’s age should not be used to make judgements about their abilities or fitness. Where such a judgement is required, an occupational health or medical practitioner should be consulted. Age should not be used as a factor in physical test requirements.

Reward

Pay and terms of employment should not be based on age, but personal contributions and standards of job performance. CIPD members can find more information and advice in our factsheet Age discrimination: reward policies and procedures.

Go to our Age discrimination: reward policies and procedures factsheet

Training and development

Employees of all ages should be eligible for training and development programmes. The automatic exclusion of age groups, such as those nearing retirement, is not only potentially unfairly discriminatory but also leads to a failure to make the best use of talent and can stop people from making better contributions and adding greater value to business performance.

Promotion

Good talent management practice requires the removal of prejudice and stereotyping in connection with appraisal and performance management.

Staff retention

Evidence shows the value of flexible working as a retention tool and encouraging return to work – see our flexible working factsheet for more information.

Go to our factsheet on flexible working

Flexible working should not be age biased but open to people from all age groups on the basis of business needs.

Redundancy

When releasing employees, the organisation’s future needs for knowledge, skills and
competencies should be taken into account to safeguard an organisation’s economic success. Organisations need to be careful about depending on the sole use of ‘last in-first out’ (LIFO) as a method of selecting for redundancy. This is likely to be unlawful as it may be indirectly discriminatory.

Retirement

Requests to work beyond retirement age must be properly considered.

Seventy per cent of 50-year olds stay on in work until state pension age. Research from CIPD indicates that many older workers would welcome an opportunity:

for phased retirement
for flexible working
to work beyond the normal retirement age
to work on a self-employed basis
to work in the voluntary sector.

As a way of retaining older employees for longer, a number of employers have abolished mandatory retirement and some chose not to use the default retirement age of 65.

An action plan

Review

Scrutinise all your organisation's people management and development policies, practices and procedures – even those that are not labelled 'HR' – because age discrimination can:
- occur anywhere in the employment cycle from recruitment to redundancy
- be blatant or subtle, direct or indirect.

Policy

Implement a policy on age tackling age discrimination as part of an approach to diversity and inclusion.
Use only objective job criteria essential for satisfactory performance, and ensure these can be objectively justified.
Communicate your policy on tackling age discrimination to all managers and employees, and offer appropriate training to make sure it is implemented as intended.

Key actions

Conduct an age audit.
Remove the use of age, age guidelines and age-related criteria.
Challenge the use of age and age-related criteria in every aspect of employment decision-making.
Educate and train all staff about the implications of age discrimination.
Use dates of birth only for monitoring purposes and administration. Give written assurances about the way monitoring information will be used to gain the confidence and trust of job applicants and employees and follow this up to ensure this is assurance is not compromised.
Monitor the age profile of your organisation at regular intervals to spot unfair discrimination against particular age groups.
Consider ways of making sure that all age groups have access to development and promotion opportunities and are motivated to continue to improve the contributions they make.

CIPD viewpoint

CIPD is committed to the removal of age discrimination in employment because it is wasteful of talent and harmful to both individuals and organisations. The use of age, age bands and age-related criteria reduces objectivity in employment decision-making and increases the likelihood of inappropriate decisions which can harm organisational performance and damage corporate reputation if legal claims are taken.

Employment decisions based on age are never justifiable because:

age is not a genuine employment criterion
age is a poor predictor of performance
it is misleading to equate physical and mental ability with age
when age is used, it tends to be a proxy for underlying factors, such as health or ability to drive, for example.

The efficient and effective use of people’s skills requires that employment decisions should be based on competencies, qualifications, skills, potential and objective job-related criteria obtained through careful analysis of job requirements and job performance.

CIPD believes there is an important business case for employers to remove age discrimination and has undertaken research and published guidance to raise awareness and educate personnel practitioners and employers about the issues involved. Organisations need to appreciate how competitive benefits can be gained from developing good practice. This will motivate them to implement progressive change and interpret the legal duties in positive ways which go beyond a minimum approach to compliance.

Although CIPD recognises that the law can help to effect change in employment practice, understanding the business case for removing unfair age discrimination plays a key role.

Useful contacts

Acas
Helpline: + 44 (0) 845 747 4747
Business Link
Employers Forum on Age
Equality and Human Rights Commission
The Age and Employment Network

References

DEPARTMENT FOR EDUCATION AND EMPLOYMENT. (1999) Age diversity in employment and Age diversity in employment: guidance and case studies. Code of practice. Nottingham: Department for Education and Employment.

Age and employment