APPENDIX 17
Memorandum from GMB Research Department
INTRODUCTION
The GMB trade union has some 700,000 members
working in private industry, the public services and the voluntary
sector. Our members come from all walks of life and they can be
found in most occupations and most industries in the UK.
Age-related issues are moving up the political
agenda. Together with other developed countries, the UK is expected
to experience a marked demographic shift, with fewer workers under
50 being available. As our society ages, there will be a greater
demand for older workers. Yet our experience shows that, at present,
these workers are routinely overlooked and discriminated in the
labour market.
In line with the general public, GMB members
have concluded that age discrimination is an unacceptable practice
which must be tackled. GMB policy calls for the enactment of effective
age discrimination legislation.
1. In what ways and to what extent are older
workers treated less favourably than younger workers as a result
of their age?
Age discrimination differs from other forms
of discrimination because it will affect everyone of us, in some
way, at some stage in our lives. While it is recognised that younger
workers also suffer from discrimination on age grounds, eg lower
rates of pay (discrimination which has been reinforced by the
national minimum wage provisions which apply a youth rate to the
under 21s), younger workers do, at least, get older. It is when
people reach "middle age" that discrimination really
starts to bite and continues to get worse.
The stereotypical older worker is primarily
viewed as a man aged between 50 and 65 years. This view excludes
significant groups such as women returners many of whom will delay
re-entering the labour market until their children are in secondary
level education and who are penalised as a result. Other important
groups include older people with disabilities and older ethnic
minorities. These groups commonly suffer double discrimination
as a result of their disability/ethnic background coupled with
their age. Older ethnic people, especially first generation, suffer
in comparison with younger members of their community usually
because the latter are British educated with English as their
first language.
Research on behalf of the DfEE confirms that
older workers are disadvantaged compared to their younger counterparts.[22]
They are at greater risk of exiting the labour market permanently
and it is much more difficult for them to re-enter the workforce.
Obviously, there is a loss incurred to those individuals who are
denied the opportunity to work but there is also a cost to the
economy as a whole. Which the Employers Forum on Age estimates
costs the UK economy £26 billion per year.[23]
Age discrimination affects older workers at
all the stages of the employment cycle. The following are some
examples of cases recently reported by GMB members.
Recruitment
GMB Birmingham and West Midlands Region reported
the case of a member, a highly experienced sewing machinist, who
was seeking similar employment following redundancy. The prospective
employer said he was impressed by the woman's references and her
curriculum vitae. He then asked the applicant how old she was.
She replied 58 but added that she had no intention of retiring
at the state retirement age. The employer concluded that she was
too old for the job. He wanted to recruit "someone much younger
in order to get more years out of them".
GMB CFTA Section, which covers workers in the
construction, furniture and timber trades, reports that older
workers are deliberately not recruited by construction companies
as they are seen as being too expensive to engage compared to
younger counterparts. A view which has been confirmed by research
supported by the European Social Fund.[24]
Loss of employment
GMB Scotland reported the case of a member working
for Manpower, the employment agency, on a British Telecom contract.
British Telecom has a blanket policy of not employing agency staff
aged over 60. As a result, a number of workers were given notice
to end their assignment within the BT contract. Manpower however,
do not operate a "fixed age" policy and gave a commitment
to re-deploy the staff affected within the local area.
GMB Scotland also reported cases of workers
in the Rosyth Dockyard where the employer had attempted to use
the company pension scheme to fund redundancies of those aged
60 and above, whereas the official retirement age was 65. Under
the threat of legal action the company retracted and the affected
employees remained in employment.
Promotion
GMB Southern Region report the lack of promotional
opportunities for older workers in a leading national food and
clothing supermarket chain. GMB members throughout the region
felt that the company was guilty of age discrimination in relation
to promotions. The company appeared to have a policy of promoting
younger, less experienced and able staff, rather than older colleagues.
2. What benefits does promoting age diversity
in the workplace offer to employers and employees?
The Government's Code of Practice outlines the
business benefits for having an age diverse workforce. The arguments
are persuasive and the GMB broadly accepts them. Forward-looking
companies have been able to differentiate themselves from their
rivals by employing older workers which, in turn, provides competitive
advantage. It also makes sense, in a tightening labour market,
to retain older workers together with their skills. However, the
question remains as to why the business community has been so
tardy to recognise these apparent benefits. The answer would seem
to be that legislation is the key requirement. Promotion of the
Code of Practice, by itself, is not sufficient to deliver the
necessary of changes.
Over the past 20 years the proportion of men
aged between 50 and 65 years not economically active has doubled.
Older workers have been shaken out of the labour market and many
have found it impossible to return to the world of work. Clearly,
older workers would benefit from an age diversity culture where
their contributions were valued, irrespective of their age. The
economic benefits are also clear. Rather than being dependent
on state benefits most 50-year-olds would prefer to be given the
opportunity to earn a living. Employment is also more likely to
enhance the particular individual's sense of well-being.
3. In what circumstances (if any) is the use
of age as a criterion for the recruitment and retention of employees
justified?
The GMB believes that age discrimination in
employment should only be allowed in restricted circumstances.
One of the key aims of any legislation should be the protection
of young workers. Ideally the GMB would prefer that the under
18s were in full-time education or training.
The Working Time Directive, in its preamble,
states that "Member States should take appropriate measures
to ensure that the working time of adolescents receiving school
education does not adversely affect their ability to benefit from
that education". There is widespread evidence that 16-17
year olds are spending up to 20 hours a week working part time.
It is not unusual for pupils at this age to be in class for 26
hours with another 18 hours required for designated homework,
a total of 44 hours per week. As a result of part time working
homework is often ignored. The GMB has called upon the DfEE and
the DTI to co-ordinate policy to achieve a balance between work
and study for adolescents at school. The departments must set
priorities and develop a coherent policy in order to protect young
people.
Age-related health and safety grounds could
be applied as the basis for barring young workers. However, such
an exclusion would not have a general application and such occupations
would need to be strictly defined. An initial aim would be to
remove all possible hazards by implementing risk assessments,
in accordance with health and safety legislation. However, even
allowing for such preventative measures there may still remain
jobs which can be described as being "hazardous", eg
chemicals. Criteria to be applied could require "relevant
work experience", say a minimum of two years.
The GMB does not advocate an upper age limit
on health and safety grounds. Older workers are generally regarded
as having a better safety record than younger workers. Even in
potentially dangerous occupations or those which require a high
degree of physical fitness, such as the police or fire services,
age is not the determining factor. Instead, the test applied is
the employee's level of fitness.
The costs associated with training are regularly
cited as a justifiable reason for the setting of an upper age
requirement. For example, that the costs of training are disproportionate,
say, in the case of an applicant who is within a couple of years
of the state retirement age. With the exception of occupations,
such as airline pilots, where training is both extensive and expensive,
this argument does not really stand up. Employers can never be
certain when an employee will leave for another employer.
The debate has mainly focused on the problems
faced by older workers, usually men, aged between 50 to 65. However,
there are many people in their late 60s and 70s who wish to remain
economically active. This may be as a result of an inadequate
pension entitlement or simply a desire to keep working. But there
may also be labour market reasons. GMB CFTA Section reports, that
due to acute skills shortages, it is not uncommon for workers,
aged up to 75, to be employed in the organ building sector.
Undoubtedly, with the prospect of impending
age discrimination legislation the expectations of the over 65s
will also be raised. Any debate must give consideration to the
legitimate expectations of these older workers. Usually, the main
reason given by businesses for not employing people beyond 70
years are problems associated with employers liability insurance.
However, with the impending demographic changes it must be asked
whether, over the longer term, this is a sustainable argument.
In recent years, the GMB has received complaints
of perceived age discrimination from members in this "older"
category. For example, GMB Midland and East Coast Region recently
reported the case of the 73-year-old former leisure centre cleaner
who lost his job when the local authority changed its policy and
made 65 years the upper age limit for employment. The member described
the new policy as "clearly ageist". He commented that
the termination of this contract had been taken without any reference
to his ability to do his work. His conclusion was confirmed in
the employer's letter which praised the member for "his support
and loyal service [that] had not gone unnoticed but has been greatly
appreciated".
The GMB accepts that due to practical difficulties
there may have to be some upper limit, particularly for recruitment.
We suggest, however, that there should be a distinction made between
those already in employment and job applicants. The position of
the former group could be ring-fenced with annual appraisals for
those aged 70 and over.
One GMB concern is that older workers, with
pensions, will be exploited to fill lowly paid jobs which younger
workers could not afford to take. In accordance with the recently
proposed amendments to the equal pay act, which would require
pay monitoring, we would expect companies to review their workforces
to achieve age diversity and to ensure that there was no discrimination.
4. How effective is the Government's Code
of Practice in promoting age diversity in the workplace?
Within two months of the launch of the Code
of Practice it was claimed that 70 per cent of employers were
aware of the Code. A fact seized upon by Andrew Smith, the then
employment minister.[25]
However, research by the Employers Forum on Age found that two-thirds
of employers said the Code would make no difference to the way
they operated their business and less than 10 per cent intended
to change their recruitment or training policies to comply with
the Code.[26]
In the intervening period there has been no evidence that the
Code has made any significant impact.
The GMB publicised the Code of Practice, together
with guidance for negotiators and representatives, as part of
our Bargaining Brief series. To an extent, we have been successful
in getting "age" included as part of companies' equal
opportunities policies. But age discrimination cases are usually
individual, not collective.
The Code's non-statutory basis remains its fundamental
weakness, a fact which is increasingly being recognised. A majority
of the Employers Forum on Age, the group which has championed
the voluntary approach, now accept that the Code of Practice should
be given legal force.[27]
The GMB and others had warned that only forward-looking employers
would implement the Code, the majority would continue to sue discriminatory
practices. Unfortunately, that is what has happened.
5. In what ways do other Government policies
such as the New Deal help or hinder older workers, especially
unemployed job seekers?
The New Deal for the over 50s was launched nationally
in April 2000. This programme offers one-to-one advice from a
personal adviser on topics such as job search or interview skills.
It also offers a weekly subsidy (£60 for a full time job)
with a guaranteed take home wage for the first year and a training
grant of up to £750 may be available when the claimant starts
work.
The key difference between this programme for
older workers and the New Deal for young people (18-24) is that
the latter group undergo a period of intensive help, known as
the Gateway, which provides advice, guidance, information and
support in finding a job. The Gateway, can last up to four months,
and aims to enhance the young person's employability and help
them get employment. Unless the young person finds a job they
are offered one of four choices: a subsidised New Deal job, environmental
work, work in the voluntary sector or full-time education or training
and, as we know, there is no fifth option.
The New Deal for the over 50s has not been running
long enough to know whether or not it is a sustainable programme.
It has, however, been reported that there has been poor awareness
and almost non-existent take up of the training grant.[28]
Many of the clients of this programme have been out of the labour
market for a long period. It is reasonable to assume that, all
things being equal, if older claimants were provided with a programme
similar to the New Deal for Younger People their levels of economic
participation would be markedly enhanced.
The GMB has already made known our suggestion
for a New Deal for Women Returners, ie beyond those on benefits.
This would include "one stop" personal advisers who
could provide guidance, support and help. Such an initiative would
give these women real choices by offering support to those who
wished to return to work. This proposal would probably be self-financing
as many would become taxpayers.
On the whole the Government must be congratulated
for the positive measures that it has adopted since coming to
power. As we have already stated improvements can be made to the
New Deal for older workers. It would be expected that such changes
would improve this group's employability. However, it would be
a mistake to assume that, in the absence of age discrimination
legislation, such supply-side measures can cure older workers'
current low levels of economic activity. It would also be an error
to ignore the UK's regional inequalities which must also be tackled.
6. Is there a case for anti-discrimination
legislation and, if so, what provisions should it include?
The GMB's view remains that there is an overwhelming
case for legislation to combat age discrimination. Policymakers
must accept that age discrimination is just as unacceptable as
discrimination on grounds of sex, race or disability. The fact
that age discrimination is not presently unlawful sends out the
wrong message that it is, somehow, less important and therefore
an acceptable practice.
The Government's Code of Practice has failed.
There will be those who will argue that the legislative approach
has not removed other discriminatory employment practices. Instead,
they will continue to argue in favour of the voluntary approach
claiming that the business case will ensure that "good practice"
becomes the norm. The GMB's view is that we cannot rely on the
labour market alone to solve the issues of age discrimination.
It will also argue that age is a difficult issue
to legislate.[29]
For example, it is often asked "how do you define a younger
or older worker?". However, just because something is problematical
is not, by itself, a sufficiently compelling argument against
legislating. In any case, is that the right question to ask? Surely,
the correct enquiry is "is age the reason why?" the
person was not recruited, promoted, trained retained etc.
Legislation is the prerequisite for the necessary
culture change (and following the enactment of the Framework Directive
on equal treatment in employment and occupation the UK will have
legislation by, at least, 2006). Legislation will act as a catalyst
to encourage good employment practices and procedures. Crucially,
it will enable older workers to seek legal redress. Also, it would
send out a clear message demonstrating society's strong disapproval
of a morally unacceptable practice.
The GMB welcomes the recent enactment of the
Framework Directive but we recognise that this only provides a
minimum floor. The GMB would be opposed to the UK Government transposing
the Article 6 list of justifications of differences of treatment
on grounds of age. In our view, the list is too widely drafted
and would allow EU member states to tolerate most forms of age
discrimination indefinitely. The GMB will argue for a comprehensive
statute with exemptions restricted to clearly defined areas.
The statute should be framed to reflect the
over-reaching principle that it is unlawful to discriminate solely
on grounds of age. The provisions should extend to remove statutory
age limits, eg when claiming unfair dismissal and redundancy payments.
It should also apply to occupational pension schemes. The GMB
remains opposed to age restrictions being placed on access to
occupational pension schemes. Young workers should be allowed
to join pension schemes from the first day of employment and older
recruits should be allowed access to such schemes up to one year
of reaching that scheme's normal retirement age. For example,
if the normal retirement age is 65, then 64 would apply as an
upper age limit for joining the scheme. Whether individuals apply
to join their particular scheme will then be a matter of personal
choice.
Lastly, the GMB is disappointed that the UK
Government chose to negotiate a further three-year extension which
could delay implementation until 2006. We will actively urge the
Government not to utilise the extension but to enact legislation
by the previously envisaged deadline, ie 2003.
GMB Research Department
January 2001
22 Characteristics of Older Workers, DfEE Research
Report. Back
23
Employers Forum on Age report, "A Profits Warning-the macroeconomic
costs of ageism" (1998). Back
24
Construction News, 30/03/00, page 4. Back
25
DfEE Press Release, 399/99, 6 September 1999. Back
26
EOR No.88 November/December 1999. Back
27
Howard Davies, EFA Chair, quoted in People Management, 16
March 2000, page 10. Back
28
Working Brief, November 2000, page 7. Back
29
EOR NO.95, January/February 2001, page 17. Back
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