Is age discrimination a problem in financial services?
Anti-discrimination efforts across financial services have predominantly focused on gender and racial equality issues. In both these areas, the country is making great strides towards a fairer, more diverse workplace.
But are other forms of discrimination being left behind? Ageism appears to be a problem in the UK, with 70.8 per cent of respondents to a CV-Library study saying this form of discrimination was common in their workplace.
The figure was slightly lower (62 per cent) among finance professionals specifically, but nearly one-third within the industry suspected they had been rejected for a job because of their age.
“It is clear that discrimination around age is not only rife in workplaces, but also during the hiring process,” said CV-Library founder and managing director Lee Biggins.
“But, while employers may think their pickiness will secure them the very best workers, they’re actually limiting themselves even further.”
However, employees may be fighting back both in the UK and across the pond. Is age discrimination set to be the next big battleground for equality in the workplace?
Big Four firm fights age discrimination case
PwC is currently facing a lawsuit in the US that alleges the firm heavily favours younger job seekers by focusing on university campuses for new hires and failing to consider older candidates for entry-level roles.
The plaintiffs may have a point. Their lawyers presented a study to the San Francisco federal court that showed young people have a 538 per cent better chance at landing a job with PwC than applicants aged 40 and over.
According to Bloomberg, there are 32 plaintiffs currently suing the accounting firm for age discrimination, but a court decision is pending to see whether or not the case can proceed as a class action. This could add more than 12,000 disgruntled former applicants.
The original plaintiffs were middle-aged accountants who applied to PwC but were rejected. They argue that the company’s history of recruiting primarily on colleges excludes suitable applicants who aren’t attending higher education, thus discriminating against older workers.
“It’s fairly clear when you look at the PwC case that college recruiting can be used in a discriminatory way,” Patricia Barnes, a lawyer specialising in discrimination law, told Bloomberg.
What are the plaintiffs chances of winning?
In the US, a 2009 Supreme Court decision made age discrimination cases tricky to win. The judges ruled age couldn’t just be a motivating factor in an employment decision, it must be the primary cause of the action in order to prove discrimination.
Nevertheless, age discrimination has been on the US legal radar in recent years. A landmark $12 million (£8.5 million) ruling last year against Texas Roadhouse for routinely rejecting applicants aged over 40 could spell good news for the PwC claimants.
But what about in the UK? Well, finance professionals here appear to have had greater success at suing their employers.
In 2013, senior analyst Tony Shiret was earning £350,000 a year at Credit Suisse when he was allegedly chosen for redundancy based on his age. He reached a confidential settlement with the bank after a London tribunal ruled in his favour.
Five years earlier, 42-year-old investment banker Achim Beck was sacked from Canadian Imperial Bank’s London office.
He was successfully able to argue he was let go based on his age because a memo sent to a recruitment firm said they were looking for someone “younger” to fill the vacancy. Incidentally, his replacement 38 – just four years younger.
Hiring practices in the firing line
Traditionally, age discrimination claims come from those who have lost their jobs, but the PwC and Texas Roadhouse cases show firms hiring practices are likely to be a key focus in the years to come.
People who are passed over for promotion may also take umbrage with employers if they believe age was a factor in decision-making. A recent Capita Resourcing survey revealed 12 per cent of over-50s feel they have lost out on career opportunities because employers felt they were too old for the job.
But diversifying a workforce’s age range is more than just about avoiding a lawsuit. Older employees provide significant benefits to organisations.
According to Chartered Institute of Personnel and Development research, employees who work in age-diverse teams say they enjoy:
- Better knowledge-sharing;
- Improved customer service;
- A wider understanding of different perspectives;
- Enhanced problem-solving; and
- Greater innovation.
Tackling age discrimination
So, returning to the original question: does financial services suffer an age discrimination problem? The research suggests that ageism is an issue, but probably no more than in most other industries.
Nonetheless, employers should work to stamp out any hiring and firing practices that may discriminate against certain age groups – both young and old – within their ranks.
Diversity is a topic at the top of the agenda in many organisations today. Let Barclay Simpson help you ensure your recruitment processes cultivate the best and brightest talent from a variety of backgrounds.
For roles specifically within first line and second line Treasury risk oversight, please contact me on 0207 936 2601 or via email at email@example.com.
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