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Last Updated: Monday, 26 June 2006, 22:59 GMT 23:59 UK
Rising to the ageism challenge
By Clare Matheson
Business reporter, BBC News

B&Q's oldest worker Sid Prior, 91, with colleague
Age has proved to be no barrier for B&Q's oldest employee Sid Prior
Incoming anti-ageism laws should help the UK to deal with its increasingly mature population.

According to government figures, there are six million people currently aged between 59 and pensionable age.

Meanwhile, over the next 15 years the number of over-50s will rise by three million - yet the overall population will grow very little.

So far, the government has been trying to prepare for an ageing population by shaking up its pension provisions - as have many company schemes.

But soon anti-discrimination legislation will mean companies will face age obstacles in the workplace.

Overall the laws will ban direct and indirect discrimination in the areas of recruitment, promotion and training.

Most concerns about the impending shake-up centre around older employees, but some experts have raised questions about what the change will mean for younger staff - as young people will also be able to take advantage of the new laws.

A recent study by recruitment firms FSS and Crone Corkill found 55% of people thought over-55s suffered discrimination at work, compared with just 23% who believed young workers were discriminated against.

Wage worries

Some reports had suggested the regulations could mean trouble for the minimum wage - as younger workers are paid a lower level than those over the age of 18.

However, such fears have proved unfounded, as any legislation currently in force is not affected by the new rules.

While the change has been welcomed in many quarters, the TUC has attacked it as a "missed opportunity".

It would be a real shame to spoil this advance, by levelling down statutory redundancy payments so that workers of all ages get the same lower rate
Brendan Barber, TUC

Retaining the national minimum wage (NMW) means companies will still be able to discriminate against workers through banded pay scales for different age groups, TUC senior policy advisor Lucy Anderson says.

"The new laws are very complicated, there's lots of exemptions. This is the most uncertain discrimination legislation we have had for a long time," she says.

"Unions and employers are concerned that the new laws shouldn't be about unpicking the reward and benefit system," adds Sam Mercer, director of the Employers Forum on Age.

Cost fears

Ms Mercer says groups have raised concerns about "levelling down".

Workers fear companies will stick to the minimum wage for workers, as any firm that operates outside the bands will have no statutory defence.

"Levelling down is a potential sticking point with unions. Employers are saying if they treat everybody equally they can't afford to level up," Ms Mercer adds.

"Companies are going to average out so there's cost neutrality instead, which will lead to some older workers getting a worse deal."

Older men playing computer game
Because you're older doesn't mean you can't remain young at heart

Wages are not the only problem on this front, the TUC fears that older workers - who had previously won a good deal in redundancy payments - could have their redundancy pay "levelled down" to that of younger workers.

"It would be a real shame to spoil this advance, by levelling down statutory redundancy payments so that workers of all ages get the same lower rate," says TUC chief Brendan Barber.

Instead, the union group has called on the government to use the coming change in the law as an opportunity to boost the current low level of redundancy payments.

Challenges ahead?

Meanwhile, Ms Mercer believes legislation surrounding both the minimum wage and redundancy pay could be open to challenge.

We have found that older employees help increase the levels of satisfaction amongst our customers
Jeremy del Strother, Nationwide

But until the rules come into force, the future of the employment landscape seems uncertain.

"The first company awards will offer guidance but its hard to know how it will be accepted," employment law expert Michael Farrier says.

"Companies will have to justify their decisions to employment tribunals. And those tribunals will be more sympathetic to employees - for example if you're too old to train the employer must objectively explain why."

With claims potentially worth up to 250,000 it's inevitable some will be launched.

"More-mature claimants will have more to lose financially if they're sacked; they will be forced into claiming to stave off the financial pressures of bills and so on for themselves," Mr Farrier says.

He also warns that firms will have to think carefully about refusing downgrades for staff who may be willing to take a wage cut for less stress or medical reasons.

Silver lining

But, despite the many problems that have been flagged up, the changes are expected to have many benefits as well.

"In the long-term the laws will have benefits for recruitment and retaining older workers," CBI senior policy adviser Richard Wainer says.

Older shop worker
Older staff can offer experience to colleagues and customers

But its not just staffing levels that benefit - some firms have already implemented their own anti-ageist policies and are reaping the rewards.

Nationwide Building Society has been praised for its flexible retirement deal which allows staff to stay on until the age of 75 and aims to avoid "corporate memory loss" through the departure of older staff.

Jeremy del Strother, Nationwide's divisional director of personnel, says: "We have found that older employees help increase the levels of satisfaction amongst our customers."

Older and wiser

And DIY chain B&Q has found a good over-50s policy can provide a "golden oldies" opportunity.

As part of an experiment B&Q staffed its Macclesfield store entirely with over-50s for a number of years.

Profits were 18% higher at the site and staff turnover was six times lower, while absenteeism fell by 39%.

The store is no longer the exclusive preserve of older staff, but now out of a total workforce of 39,000 over 25% of B&Q staff are aged 50 or over.

And as their oldest worker Sid Prior, 91, says: "Working with people of all ages gives youngsters the chance to learn a little from an old timer like myself, and they help to keep me young at heart."

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