Letter from London: Culling Seniors, an Unseemly Rush
The last time I tried to predict the future, assisted by some rather good bubbly at a very jolly party, I ended up palm-reading for some newly-met bankers in my best Gypsy Rose Lee fashion.
It was a bit of fun, and nobody minded if the predictions were rather wide of the mark. Sadly, the urge to look into the future has come upon me rather strongly of late, it isn't bubbly-assisted, and this time I think the prediction will be spot on: Older workers in the markets will be the new redundancy fall guys.
Are you over forty? Do you work in the City? On Wall Street? Have HR directors started to avoid eye contact? Oh dear, there may be trouble ahead...
If you are over forty, you're about to enter an exciting phase of your life, where the unexpected and the challenging will deliver a new and totally different existence for you and your loved ones. Fear not, you will not be alone.
Friends you did not know you had will accompany you on this new path, and you will emerge stronger, happier and much more contented than you could have imagined.
(Oh alright, I made that last bit up. As a believer that hoping for things can sometimes translate into achieving things, it's a bit of a habit of mine.)
Legislation prohibiting discrimination against workers on the basis of their age is due to come into force in Britain on 1 October 2006. The law will put 'mature' workers on a similar legal footing to those claiming racial, ethnic and sexual bias from there on in. Until then, if you're the wrong side of forty, I recommend you keep your head well under the parapet. October 2006 may sound like a far way off, but you can bet banks know all about it now. So should you.
Anti-ageist legislation has been on the books in the States since 1967. (I was a very wee nipper at the time, so can be forgiven for not noticing.) That puts the UK nearly forty years behind the US in the way it treats mature workers.
Even with the legislation in force for decades, recent stats from Wall Street are chilling: In December 2004, one US branch of a European bank 'let go' 80% of its employees over age 50, and 30% of those over age 45, at two US locations, according to an attorney advising some of the workers. He declined to name the bank.
Things aren't much better in London, where there's been a noticeable increase in redundancies involving seniors in recent months. Banks are targeting experienced individuals and claiming cost considerations, rather than age, lie behind how staff are selected for redundancy.
Roger Tynan, an employment partner at Campbell Hooper Solicitors in London, says, 'In the period leading up to the introduction of age discrimination legislation in October 2006, there may well be an unseemly rush to dispose of senior employees perceived as more expensive and less driven than their younger colleagues.'
'Employers risk losing sight of the value of more senior staff in terms of their experience, contacts and understanding of the markets,' Tynan tells me. 'Instead decisions may be driven by the fear of unlimited legal claims by those within a few years of retirement who find their careers suddenly at an end because they're not 'young and sexy enough'."
You only have to look at Alan Greenspan and Warren Buffet to see that age isn't a barrier to being a financial whiz-kid however many candles you have on your cake. George Soros isn't exactly a spring chicken, now I come to think of it.
Sadly, the perception in the workplace, be it Wall Street or the City, is that if you're over 45 you're a has-been in certain roles. The faces in equity research, for example, are getting younger and younger. The length of the working day coupled with the pace of life in the financial world is considered too much for seniors, and so the cult of youth prevails.
Some time back there was a push to employ and retain experienced workers - some wag even came up with a name for them: Grey Leopards. A drift against the usual tide of jettisoning those with more than twenty years' experience in the markets seemed to be under way. Unhappily, it was short-lived, the leopards were sent back into retirement and the young cubs held sway yet again.
One of the main problems is that employers will claim that they are reducing the number of highly paid workers who just happen to be the older ones, so even when the age discrimination legislation comes into force, the onus would be on the employee to prove discrimination on the grounds of age. It's a tough row to hoe.
To be fair to the banks, when shedding members of the workforce they usually offer severance payouts to those departing. These vary from bank to bank and country to country and the generosity is dependent on the seniority of the employee.
On Wall Street severance packages for senior employees are typically on the generous side, often a year or more of compensation, as well as other perks such as health insurance. In London payouts are considerably less, and quite often just a fraction higher than the cap of 56,800 ($109,000) which an employment tribunal can award in cases of unfair dismissal.
There is a case for treating senior workers with special care; they are less likely to slot into another position either quickly or easily, and although banks can get away with getting rid of them currently, they will be brought up sharply come October next year.
Philip Beddows, director at business transition and HR advisors The Rialto Consultancy, believes that the City will have to learn to accommodate older workers and make use of their talents more effectively: 'If we're lucky we'll get old. If we're even luckier, the behaviour we have shown to the older generation above us will be what we receive from the younger generation behind us. You have to set an example of excellence.'
And if you don't, remember that a leopard still has a savage bite, however grey it may be... I'll leave you with a sweet little bite from Francis Bacon (1561 -1626):
'Young men are fitter to invent than to judge,
fitter for execution than for counsel,
and fitter for new projects
than for settled business.'
Jane welcomes feedback and guarantees complete confidentiality to anyone who wishes to discuss employment issues with her: firstname.lastname@example.org.