The Costs of Ageism: fines, bad press and lost opportunities.

A Landmark Tribunal Case and Its Implications

In a significant employment tribunal ruling last week, engineering manager Glenn Cowie was awarded £3.2 million after being dismissed by his employer, Vesuvius, due to an ageist hiring policy favouring candidates under 45. Dr. Emily Andrews from the Centre for Ageing Better highlights that such discriminatory practices not only harm individuals but also undermine companies and the broader economy.

Age Discrimination in the Workplace

“Having extensive experience in addressing workplace ageism, I've encountered countless stories of job applicants and employees over 50 facing unfair treatment solely due to their age. Yet, even I was astonished by the tribunal's findings.” Cowie, dismissed at 58, was replaced by a younger manager after Vesuvius's CEO expressed a preference for hiring individuals under 45 to ensure ample career development time.

The Cost of Ageism

This narrow-minded approach cost Vesuvius dearly. Cowie was awarded £3.17 million for financial losses, emotional distress, and costs associated with his relocation. While Vesuvius is appealing the decision, this case underscores the severe repercussions of age discrimination.

The Broader Impacts of Ageist Policies

Ageist hiring practices not only violate legal standards but also ignore demographic realities. With an aging population and a finite supply of younger workers, excluding candidates over 45 significantly shrinks the talent pool. This approach hampers a company's ability to find the right skills and impedes overall productivity growth in the UK economy.

Economic Benefits of Embracing Older Workers

Research by the Centre for Ageing Better reveals that providing older workers with equal opportunities could boost the UK economy by £9 billion annually. Reducing the employment rate gap between older and younger workers could also generate an additional £1.6 billion in income tax and national insurance contributions for the Treasury.

The Need for Training and Development

Older workers often receive fewer training and development opportunities, particularly in leadership, management, technical, or digital skills. This neglect means employers miss out on the potential benefits of upskilling their most experienced employees. Contrary to outdated beliefs, older workers are capable of significant career development, as evidenced by the Prime Minister's successful career shift after 50.

The Value of 50 Employees

The average UK employee stays in their role for less than five years, yet older employees tend to stay longer. Investing in the development of 50 employees can yield substantial returns over time. Many organizations recognize this value. Over 370 employers, including Zurich Insurance, Arla Foods, and the Department for Work and Pensions, have signed the Age-friendly Employer Pledge, committing to improving work opportunities for people in their 50s and 60s.

50-year-olds still have more than a third of their working life left

KPI Director Lily James said, “The knowledge and experience the over 50’s can offer businesses is huge. More mature people generally offer far better people-management skills and have the resilience and wisdom of coping with far more crises. By ruling out the over 50’s, companies are not only reducing their potential pool of talent, they are also dismissing people who can offer the most expertise and knowhow. And with the retirement age now 67 (and likely to increase further) candidates aged 50 have over a third of their working life ahead of them.”

Conclusion: Embracing a Multigenerational Workforce

Companies with a higher proportion of older workers benefit from their extensive experience and lower turnover rates, leading to increased productivity. As our demographic landscape evolves, age-friendly employers will be best positioned to thrive. Embracing the talent and potential of older workers is not just a legal or ethical imperative—it's a strategic advantage in today's competitive market.

If you need advice on how to recruit better people, or if you’re over 50 and looking for a better job, speak to a recruitment consultant at KPI.