Baby Boomers, Age Discrimination and a New Court Ruling

Older workers who feel threatened by millennials in the workplace just received more bad news. A federal law barring age discrimination in employment applies only to those currently employed–not those new applicants who may be applying for a job.

Seeking candidates with no more than seven years of experience

The plaintiff in the case, Dale Kleber, applied for a position as a senior counsel at CareFusion when he was 58 years old. The job posting said that they were seeking candidates with no more than seven years of experience, a restriction that would likely hurt the chances of older applicants. This criterion did, in fact, eliminate older, more experienced candidates. The result? CareFusion hired a 29-year-old candidate, and Kleber filed an age discrimination lawsuit in December 2014.

The ADEA has protected against age discrimination for more than 50 years

The Age Discrimination in Employment Act (ADEA), which took effect in 1968, is designed to protect workers age 40 and older from bias in the workforce. In a dissenting opinion to this ruling, Judge David Hamilton wrote that the majority was “closing its eyes to 50 years of history, context and application.”

Older workers being replaced by younger, less expensive staff

As employers look for ways to cut costs, eliminating their older, more experienced–and more expensive staff–can be easy ways to reduce budgets. Younger, less experienced workers come with a lower price tag. For many employers, it seems that experience has lost its value. But it’s not all bad news.

Looking to the UK for inspiration, olderpreneurs have found a way to thrive

In the UK, an estimated one in five people over 50 is self-employed—a higher proportion than for any other age group. They’re called olderpreneurs, and there are now nearly 1.8 million self-employed people over the age of 50, an increase of 21% since 2008.

Encouraging stories of valuing older workforce here at home

In an earlier article, we featured a New York Times story, Reaping the Benefits of an Aging Work Force, by Kerry Hannon, that shows how U.S. employers are finding creative ways to keep their older workers on the job. These employers value their loyalty, experience and strong work ethic.

• Military shipbuilding company Huntington Ingalls Industries operates The Apprentice School in Newport News, Virginia. It takes a long time to become a master shipbuilder, and this company places a high value on experience; an estimated 39% of their workforce is made up of baby boomers.
• PKF O’Connor Davies is part of a network of independent accounting and advisory firms, and they’re looking for ways to accommodate and keep their older employees. Strategies include working shorter hours and working from home at least a few days/week.
• Silvercup Studios is a family-owned film and television production company in New York. Two workers recently celebrated their 30th anniversaries with the company. Silvercup likes people with experience–they’re more settled and loyal. The company understands that the costs of acquisition and training are high and wants to keep good employees.

What’s next for the 8-4 ruling from Chicago’s full U.S. Seventh Circuit Court of Appeals?

“We strongly disagree with the decision and find it very disheartening that the court interpreted a civil rights law so narrowly, despite the statutory language and the great weight of Supreme Court precedent,” said Dara Smith, an attorney for AARP Foundation Litigation, which represented the plaintiff. “Mr. Kleber and all older job seekers deserve all of the protections Congress intended to give them. As of now, we are considering our options for next steps.”

Many of our clients are creating Living Trusts, so office conversations frequently span a range of senior-related topics, including Trusts as an important part of life planning. Our comprehensive Trust package includes a Power of Attorney and Advance Healthcare Directive. Schedule an appointment today by contacting us at one of our three Bay Area offices. Our dedicated team is helpful, compassionate and affordable.

“Olderpreneurs”: Carving Out a Larger Role in the Workforce

In our youth-driven culture, we hear more about people losing jobs because they’re too old than we do about those over 50 who are launching new businesses. In the UK, however, this demographic is thriving. An estimated one in five people over 50 is self-employed—a higher proportion than for any other age group. They’re called olderpreneurs, and there are now nearly 1.8 million self-employed people over the age of 50, an increase of 21% since 2008.

Entrepreneurship is no longer the exclusive domain of the young

Many of those starting new businesses realize that they have the life skills, contacts and business experience that will help make them successful. They understand sales cycles, marketing, the importance of relationships and often have more money for the startup investment. Statistics show that older entrepreneurs tend to be more successful than those who are starting businesses at a younger age.

Other typical demographic information of olderpreneurs in the U.S.

• According to Jeff Williams, founder of BizStarters, a service that coaches older entrepreneurs here in the U.S., roughly 60% of clients prioritize schedule flexibility over economics—being able to take time off to travel or spend time with family is important.
• Very few older business founders are trying to replace corporate salaries; average earnings expectations are $50,000-75,000 a year.
• The majority also prefer to be solopreneurs, depending on strategic alliances when necessary. Many have spent their careers managing workforces and now prefer to create a simpler business model that fits their new lifestyle—without employee concerns.
• The internet, which enables research, virtual sales and sourcing, has made the solo enterprise model infinitely more accessible.

Regardless of age, new business owners need to identify a business formation structure

Whether 25 or 65, those starting new businesses in California need to identify a business formation structure. Many people with years of industry experience retire and become consultants, often going back to their former companies on an advisory basis to share their expertise. For these individuals, a sole proprietorship may be the right business structure. California Document Preparers assists our clients in preparing the documents to set up the business structure, such as an LLC or S Corp, that is the right fit at the right time for your business.

From sole proprietor to corporation

A number of our clients starts out as sole proprietors, but as their businesses grow, as they hire either part-time or full-time teams, they choose to incorporate, separating the business from the owner. A corporation acts like a separate body that can do things like buy and sell property, be taxed and enter into contracts. Perhaps most important, it protects its owners from personal liability for corporate debts and obligations.

The growing popularity of LLCs

Many business owners who wish to incorporate these days are choosing LLCs because of the personal liability protection, flexibility and tax benefits. An LLC can be one or many members; they’re not required to have Boards or keep meeting minutes and can be managed by the members themselves.

Are you starting a new business or planning to change your business structure in the New Year? Contact California Document Preparers at one of our three Bay Area offices today to schedule an appointment. We’re helpful, compassionate and affordable.