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By Dr. Marie Gould Harper
Program Director, Management, American Public University
Every day, I set aside some time to read the headlines to find out what people are buzzing about. One item on LinkedIn that recently caught my attention suggested a correlation between company downsizing and age discrimination.
That notion is not new. It’s has been around for a number of years, but this particular story appears to take a twist from previous allegations.
When Intel Corporation went through downsizing and cut 10,000 jobs globally in 2016, some former employees went to the Equal Employment Opportunity Commission (EEOC) and filed an age discrimination suit.
According to the records, the median age of the more than 2,000 employees let go was 49, “seven years older than the median age of their peer employees who remained,” the LinkedIn summary reported, citing the Wall Street Journal.
Although Intel denied that age was a factor, I believe age was an indirect factor that no one considered when they were instituting the downsizing strategy.
Companies Downsize When They Want to Cut Expenses
Most companies will start a downsizing process when they want to cut expenses. Payroll tends to be one of the biggest expenditures of an organization. Once a company has exhausted all means of trimming operations, cutting employees is often the next logical step, especially when the company roster has the same number of people as before but with less revenue coming in.
If the issue is financial, companies will establish a plan to save the most money as soon as possible. To do so means cutting some of the highest salaries in the organization.
Unfortunately, employees who have the most seniority also tend to have the highest salaries. These are individuals who have been with the company for some time and they naturally tend to be older.
When a company targets the highest-paid employees to lay off, management may be inadvertently placing themselves in the situation of being accused of age discrimination. This scenario describes what may have happened at Intel. However, earlier this year, there was speculation that IBM was downsizing older workers intentionally.
According to a story in Verge by Chris Welch, IBM has had a practice of laying off employees over the age of 40 to hire younger workers. The actual statistics showed that IBM laid off approximately 20,000 American employees in a five-year period, “though the actual number is believed to be almost certainly higher.”
In a survey, former employees shared their perceptions of what had occurred. The overall opinion was that they lost their jobs so IBM could hire less experienced, younger workers or that the work was shipped overseas to pay cheaper wages.
11 Ways Your Company Might Be Trying to Eliminate You
What are some signs that an organization might be attempting to downsize you from the company? According to Donna Ballman, a Florida employment lawyer and author of the book, Stand Up For Yourself Without Getting Fired: Resolve Workplace Crises Before You Quit, Get Axed or Sue the Bastards, there are approximately 11 scenarios an organization may utilize to eliminate older workers from the payroll.
- Job elimination
As we continue to expand the use of technology in the workplace, it is possible to be creative about cutting positions that may be no longer necessary? Are you in that group? Where does your job fall concerning necessity in the midst of automation?
As organizations begin to eliminate old products and services to make room for new initiatives, there may be a reorganization to create positions that will support the new vision. Are you staying current and can ride the wave of change?
- Suddenly stupid
You may have been a top-notch employee, but suddenly your supervisor starts nitpicking at you for things the company didn’t care about before, or mentions areas where you are now below par. Do you document your performance so you have a rebuttal if someone challenges your skills in areas that you have previously done well?
- Threatening your pension if you don’t retire right away.
- Early retirement, offering you a package that includes financial incentives.
- Citing the company mandatory retirement age (which, with several exceptions, is probably against the law).
- Cutting job duties by limiting your authority and humiliating you with low-level tasks.
If you are suddenly moved to an out-of-the-way office, watch the types of projects you are assigned. Are you suddenly working on “special projects” that have no useful purpose to departmental goals?
- Denying promotions or opportunities for advancement are sneaky ways for the boss to claim you don’t have the experience or qualifications to get a promotion or to advance in the company.
- Cutting your hours and starving you financially to force you to quit.
- Harassment by calling you the “old man” or “old lady”; constantly asking when are you going to retire; suggesting you’re senile; or making other comments related to age.
As I read the list, my initial thought was that the rationales used in these examples could apply to anyone, particularly if you have been targeted. These acts could apply to anyone that an organization wants to eliminate.
What does all of this information have to do with wage discrimination? The targeted employee could be a person who has derailed his or her own career, and the company wants to eliminate that poor performer. In some scenarios, it might even be a long-standing individual. But some of the 11 scenarios – threatening your pension, early retirement or mandatory retirement age – do appear to apply to older employees.
If you find yourself in any of these situations, my recommendation is to create a checklist and find out how many apply to you. If a theme appears to be emerging, you may have been targeted because of age discrimination or because the organization is attempting to usher in the next new initiative. The key is to know what you are up against.
About the Author
Dr. Marie Gould Harper is the Program Director of Management at American Public University. She holds an undergraduate degree in psychology from Wellesley College, a master’s degree in instructional systems from Pennsylvania State University and a doctorate in business from Capella University. She is a progressive coach, facilitator, writer, strategist and human resources/organizational development professional with more than 30 years of leadership, project management, and administrative experience. Dr. Gould Harper has worked in both corporate and academic environments.
Dr. Gould Harper is an innovative thinker and influential leader, manifesting people skills, a methodical approach to problems, organizational vision and ability to inspire followers. She is committed to continuous improvement in organizational effectiveness and human capital development, customer service and the development of future leaders.