No more age of innocence

24 August 2006
No more age of innocence

A recent study by the London Thames Gateway Forum on Equality, Access and Participation revealed that there was some evidence of age bias in the pub, hotel and restaurant trade.

The trade tends to employ staff of a younger age group, often aged less than 30 years, due in part to a heavy reliance on casual student labour. The study revealed that food and beverage managers openly admitted to hiring young staff who reflect the atmosphere and clientele of their establishments.

One pub manager was quoted as saying that he has very few recruitment problems as young people want to work in his establishment because it appeals to a young and hip crowd. He went on to say that, when recruiting, his main criterion was to find the right person who fitted a certain look, age and personality type.

Hotels also often hire individuals who "fit into the team". The hotel industry often requires employees to work anti-social and long hours. As a consequence, hotel managers tend to recruit "young, free and single" individuals, who they think will cope with the long hours and fit in with the atmosphere and after-work socialising.

The industry also tends to recruit trainee managers who are young, as there is a belief that they can be more easily moulded to the workplace culture and ethos than older people. Young, casual and part-time staff are also less costly.

But on 1 October 2006, it will become unlawful for employers to discriminate on the grounds of age (or apparent age) against employees, contract workers, partners and office holders. If pubs, hotels and restaurants continue to recruit younger people to attract a "certain type" who "fit in", or because they will be cheaper employees, they will be at risk of discrimination on the grounds of age, unless the age requirement can be objectively justified.

Anne Pierce, chief executive of Springboard, says that the sector needs to see age legislation as an opportunity rather than as a burden. "Employers mustn't bury their heads in the sand and continue as if age legislation won't hit them," she says. "All the research indicates that good age practices help improve staff retention, so we have everything to gain from being ready."

The new law will prohibit both "direct" and "indirect" discrimination. Direct discrimination involves simply treating someone less favourably for a reason related to age. Indirect discrimination involves applying a "provision, criterion or practice" ("PCP") which, although seeming to be neutral, places a particular age group at a disadvantage.

Both direct and indirect discrimination will be lawful only if the employer can establish that they are "objectively justified" as a substantial business need, although cost savings alone will never qualify as objective justification.

It will also be possible, although extremely rare, for an employer to claim that it is a "genuine occupational requirement" of a particular job that the employee be of a particular age. Employers can also claim that favouring one particular age group for a position (or in other areas, such as training) is reasonably likely to compensate for an age imbalance within the workforce.

Here we shall look at some further aspects of the new law in more detail.

Recruitment issues
The new law applies to recruitment practices including advertisements, application forms, selection criteria and interviews.

Advertisements requiring "young" or "mature" candidates will be dangerous, but requiring "energetic" or "dynamic" employees may also suggest bias towards the young, as would statements such as "ideal first job" or "recent graduates". Even such things as "must be prepared to work late" may indirectly discriminate against older workers, who are more likely to have childcare responsibilities.

It is unrealistic for employers to remove all age information from application forms, although it should be moved to a separate diversity monitoring form if possible. Job advertisements, application forms and interview questions should focus only on the skills and experience for the job. Instead of simply requiring, for example, "six years' experience", employers will need to focus on exactly what experience of particular types of work is required.

Recruitment companies will be liable if they discriminate in any way, including which candidates they select to send to a client and also in terminations of contracts. Recruitment companies may also unlawfully "knowingly assist" a client to discriminate, with only limited defences available.

Service-related pay and benefits Awarding better pay and benefits based on length of service can still be lawful.

  • Employers may award better pay and benefits based on length of service during the first five years of service only.
  • Even without the five-year rule, awarding greater pay and benefits may still be lawful if the practice fulfils a real business need, such as motivation, encouraging loyalty or rewarding experience. Employers will, however, need good evidence to show that this will actually produce this effect.

Claims, compensation and risks Surprisingly, employees cannot claim age discrimination once they are over the age of 65, although contract workers and partners will be able to do so.

A greater risk for employers will be in dismissing employees below the retirement age, especially those who may be in their early 50s and have relatively high earnings. Compensation penalties for age discrimination will be uncapped, and a 50-something employee who may have difficulty ever finding a similar position again may be able to claim loss of potential earnings for the period right up to their retirement age.

The losses for an offending company may be even more spectacular if the dismissal involves the loss of entitlement to participate in a valuable final-salary pension scheme.

Finally, any act of age discrimination carries with it the possibility of a claim for compensation for injury to feelings, which is usually assessed at between £500 and £25,000, depending on the circumstances.

Retirement dismissals
There are various technicalities to comply with, but establishing "retirement" as the reason for dismissal will broadly require:

  • Writing to the employee between 12 and six months beforehand to inform them of their retirement date and of their right to request to work beyond retirement
  • If a request is made, holding a meeting and writing to the employee to confirm the outcome, confirming the retirement date (changed or otherwise)
  • If the procedure is followed, the reason for dismissal will be retirement and it will be automatically fair. If not, it is still possible for an Employment Tribunal to decide that retirement was still the reason for dismissal, but it will not be automatic.

What to watch out for

  • Job adverts looking for "young, dynamic bar staff" or similar could be found to be indirectly discriminative.
  • Try not to match the selection criteria to the audience of the venue - if a restaurant is known for its younger clientele, it may not attract a wider pool of applicants of all ages.
  • If bar, restaurant or hotel owners continue to recruit to a certain age band, they will have to objectively justify the need for staff in that age band. Consider applications from older workers to even out the predominance of younger employees.
  • Ensure your recruitment process is open enough to welcome applications from any individuals with the right qualifications or experience. Don't confine your job advertising to the internet, for example.
  • Ensure that recruitment companies operating on your behalf do not discriminate on age.
  • Beware of informal methods of recruitment such as word of mouth, as this may lead to age bias.
  • The national minimum wage brackets for different ages will continue to have legal force.

ContactsTarlo Lyons
020 7405 2000

Age Positive
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