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Is Age Discrimination Forcing You Out?

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Exit incentives targeting older workers began in the mid-70s and continue to the present. Without violating the Age Discrimination in Employment Act (ADEA), "golden parachutes" or "golden handshakes," as these incentives are called, strongly encourage older workers to leave "while the going is good."

The facts aren't pretty. Between 1980 and 1990 an estimated three million managers, the majority 50-plus, lost their jobs. Three million layoffs translate into roughly one out of four workers. Why wasn't there some sort of public outrage, a Congressional investigation-anything? For one thing, the victims are part of a generation that, for the most part, has not learned to fight for its rights.

What motivates these cuts? Are they based solely on age bias? Or are middle managers targeted because, as a group, they are overpaid and under productive? Certainly the layoffs occur, in part, as a result of organizational survival in a complex and competitive global market. Couldn't a case be made that management's offer of the golden parachute is a benevolent gesture? Many executives think so. In fact, they consider it the most humane way to shrink the managerial workforce. Or so said a full one - third of corporate executives polled by the American Management Association in 1988. They indicated they would again offer an exit-incentive package the next time they had to reduce personnel costs. So who are the good guys? Who are the bad guys?

There are several reasons why middle managers (who happen to be 50-plus) were and are often targeted for early retirement or layoffs. First, there is the under-the-surface sentiment that younger people with families should not be laid off. Perhaps this bias is a holdover from one you may have helped perpetuate 25 years ago (the one that said "women have no business taking men's jobs because men have families to support"). And it is true many people in their 50s are in better economic shape; their children are grown and their mortgages are paid.

Second, middle managers make much more than their younger counterparts, usually because of time in service rather than because of greater productivity.

Third, yours is a generation that does what it's told. Frankly, top management thought they could get away with the parachutes and the handshakes. And for the most part, they have.

But you know all this. You may have lived through it yourself. What you may not know is the tide is turning, albeit ever so slowly. And not for any altruistic reason, either. Because of changing demographics. There are now 14 million people over 55 working in America. By the year 2010 the over-55 population will constitute 25 percent of the U.S. workforce. Predictions are that when this happens, the older worker will be viewed not as a means to reduce personnel costs, but as the organization's strength. I guess there is safety in numbers.

In his book Age Wave, Ken Dychtwald examines the importance of these demographics and the continuing impact the Baby Boom generation will have on work, culture, politics, Wall Street, even religion. Unfortunately, the majority of the Boomers will not be in their 50s for another decade or more. But then, because of the Boomers' numbers, there will be a tremendous change in how the mature worker is viewed by corporate America.

Today we are caught in an awkward transition period - a time when some companies are aggressively recruiting older workers to fill their ranks, while other companies are practicing age discrimination whenever they can get away with it. But if companies are confused, so are many workers. Fifteen years ago most employees looked forward to retirement and would have gladly bailed out if handed a $75,000 golden parachute and lifetime medical benefits. But times change, values change, and people live longer than before. The word is out that early retirement is not all it's cracked up to be. The parachute sometimes crashes, as do marriages and new businesses.

This transition has its share of incongruity and irony. For example, smart companies today are learning how to position themselves for the older consumer of the next decade. Yet some of the very companies that recognize the power of the coming demographics are nonetheless practicing age discrimination in both hiring and firing.

Aren't there laws to protect older workers from this practice? Yes, but it's tough to prove age discrimination. In the last five years especially, employers have learned a lot about what is and what is not considered age discrimination. Needless to say, they have become more careful and more knowledgeable in protecting themselves from lawsuits.

The ADEA was passed by Congress in 1967. Its original intent was to protect workers age 40 to 65 in the same way Title VII of the Civil Rights Act protects women and minorities in hiring, firing, job placement and promotion. But, unlike the Civil Rights Act, the ADEA holds no provision for affirmative action. Think about that. There is no mandate that older workers be hired first-all things being equal. There are no quotas to fill. Basically, there is no motivation to hire older people. Therefore, my friend, an employer will only hire you if you can solve a problem or meet some need. Bottom line, once again: You'll have to sell yourself.

The ADEA was amended in 1978 to cover people up to age 70 and again in 1986 when Congress eliminated mandatory retirement at any age. As the law currently exists, we never have to retire. Yet in the '80s the average retirement age actually decreased; it currently stands at 62. Of course, much of that early retirement has to do with the golden parachute issue; but in many other cases, workers simply choose early retirement. As much as anything else, it has to do with the power of suggestion. Once a worker hits 60 or 62 the questions, well-meaning perhaps, start: "So, when are you going to hang 'em up?" "Bet you've been counting the days, huh?" "What are you waiting for?" So you start thinking about it: "Maybe it wouldn't be so bad. Heck, it might even be fun not to have to get up in the morning or fight the commute any-more. ..." Once you start considering retirement, the issue snowballs, and before you know it, a hard-to-resist exit-incentive package materializes out of nowhere. The gold watch is ordered, the retirement party planned.
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