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CUSTOMER Story

How business should plan for ageing workforce?

January 22, 2020

WITH LIFE EXPECTANCY NOW SITTING AT AN AVERAGE OF 85 AND THE STATE PENSION AGE INCREASING TO 68 BY 2039, EMPLOYEES ARE LIKELY TO WORK FOR MANY MORE YEARS THAN PREVIOUSLY EXPECTED. THIS SCENARIO PROVIDES BOTH OPPORTUNITIES AND CHALLENGES FOR BUSINESSES. CONTRIBUTOR HR AND EMPLOYMENT LAW EXPERTS, ANTHONY SUTTON, MD – CREAM HR.

A CIPD report has found that 9.4 million people in employment in the UK are now over 50 – representing about 30 percent of the total workforce – and whilst many businesses are rightly reaping the rewards that many older employees can bring, others struggle to manage the practical and legal challenges an ageing workforce can present.

Whilst this demographic change provides significant opportunities to benefit from vast amounts of work experience, businesses do also need to be aware of potential legal issues that can arise as a result of an ageing workforce, particularly in the area of discrimination. As cases continue to hit the headlines, employment law experts from Cream HR, are advising businesses to be aware of the potential risks involved and to support older workers to help reduce their risk of facing a law suit.

As discrimination legislation covers every aspect of life within the UK, employers need to be aware that they cannot discriminate against an employee or worker based on age, either young or old, however, a shocking number of businesses discriminate without knowing that they are doing so.

As we age, it is quite normal for people to become less competent and capable and if your older employees’ performance has diminished as they grow older, you are able to discuss this with them and undergo capability procedure with them. The outcome of this could be the termination of employment, if after following a fair, legally compliant procedure it is found that they are not capable of carrying out their role. If your older workers are employed in roles where their capability has safety risks for themselves, their co-workers, customers or the public at large, then businesses have a responsibility to act.

Capability procedures should be handled in a careful and considerate manner, but if done correctly and with good reason, businesses are able to dismiss older employees on the basis of their capability to carry out their role.  Be aware that capability issues not only apply to older employees and you must be careful to treat all employees in a similar and consistent manner.

The fairest and most legally compliant capability procedure for an employer, is to monitor and support their workforce. As with many HR related issues, an open-door policy is the best way to build trust with your employees and make it easy for them to come to management with concerns they might have about capabilities. This also helps to create a more sensitive environment to highlight any concerns that management or other members of the team may have about another employee’s work-rate or ability.

Capability procedures do present challenges and there is no formal capability procedure set out in law. Even the ACAS website does not have a set process. Unlike a disciplinary procedure, capability processes are designed to assess an employee’s capacity to perform their role and to try and set a framework to try and help them reach the required level. If they are unable to do so having followed a clear and fair process, a fair dismissal can be a possible outcome.

It is essential that businesses follow a fair process including making sure an employee is fully aware, in writing, of the areas of concern and that meetings are held to set the actions and a timeframe for results to assess and review performance. Support and training can be offered to help employees reach any targets set. Dismissal is not the only option and employers should consider alternatives such as agreeing with an older employee to reduce their hours, to allow working from home, moving department or a change of role.

Businesses shouldn’t ignore the fact that older workers may have additional needs – they may be thinking about their finances, planning for retirement or looking to cut down their hours. A recent stand-out case from Aviva, the UK insurer, is a great example of how to acknowledge and support these changes.

The company ran a pilot scheme for 100 of its employees aged over 45 which they called a ‘Mid-life MOT’, covering three areas: career, wellbeing and finances. After huge take up and success, the business is now looking to roll out the scheme for all employees over 45. A scheme like this is a sure way to reassure employees, boost confidence and recognise that older workers are a valuable asset to your workforce, whilst presenting them with all the possible options to stay with your business in the coming years.

It is important not to forget that age discrimination rules also apply throughout the recruitment process. Business must be careful with how questions are worded and ensure all management are fully trained in conducting compliant interviews. “How old are you?” and “when do you plan on retiring?” are illegal questions. Alternatives may be, “what are your career goals?” for example.

Employees cannot and should not be dismissed because of their age, it is illegal to do this unless you can prove this is a proportionate means of achieving a legitimate aim, for instance if a role requires a certain characteristic such as physical fitness attributed to a younger employee. Remember, age discrimination is a protected characteristic under the Equality Act 2010 and should an employee present a claim to employment tribunal, there is no limit to the compensation an employee could receive.

As in most HR cases, communication is key! Check in with your employees regularly and ensure performance and capability are regularly assessed. Your older employees can be a fantastic asset. Listen to them, provide options, support and understanding to release the great value they can bring to your business.

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