When anti-discrimination laws backfireBlog added by Allen Greenberg on April 29, 2014
Allen Greenberg

Allen Greenberg

Joined: May 29, 2013

How did that silly pop culture refrain go? Fifty is the new 30?

This psychobabble got so completely out of hand that when Harris Interactive asked people last fall what age they’d like to remain the rest of their lives, 50 was the most popular response.

Call it denial, call it whatever, but this is just one more bit of self-absorbed nonsense from people of a certain age who refuse to acknowledge that, no matter how many supplements or yoga classes they take, there’s a rocking chair and porch in their near future – if they’re lucky.

I just ran across a bit of research on workplace age discrimination from the Federal Reserve Bank of San Francisco that takes this discussion from the pages of People to something with considerably more weight.

The economists who did this work said they found evidence that in states with stronger age-discrimination protections, older workers stayed unemployed for longer periods than younger workers.

You read that correctly. Where the laws were written with the interests of older employees in mind, the consequences for them were worse.

What is that, exactly? Irony of the sort that makes you want to gag? Certainly it’s evidence, once more, that no good deed goes unpunished.

The researchers – David Neumark and Patrick Button, economists at the University of California, Irvine – said they found 34 states where the Age Discrimination in Employment Act applied to more companies than the federal law did. The ADEA applies only to employers with 20 or more workers.

Also, while the federal law allows for actual damages, 29 states were found to have allowed punitive damages, too.

Previous research by the same team found that, before the Great Recession, these stronger protections enabled older workers to remain employed longer and may have increased hiring among their age group.

However, their latest examination, which covered the 2007-09 recession, found that states with laws that allow larger damage awards “have an additional 5.57 weeks of unemployment for older men relative to younger men during the recession, and an additional 5.04 weeks of unemployment after the recession.”

(Weirdly, the opposite thing happened to older women, but the authors said they didn’t have enough data on women to declare that trend to be statistically significant.)

The bottom line here? Older workers simply didn’t have better odds of getting hired in states with tougher age discrimination laws.

The economists didn’t know exactly why this had happened, but here’s their explanation, in their own words:
    • An event like the Great Recession disrupts the labor market so severely that sorting out which effects are due to age discrimination and which to worsening business conditions becomes very difficult. These complications may make it hard to demonstrate age discrimination, reducing the likelihood that the legal system can intervene effectively and fairly.

    • States with stronger age discrimination laws impose constraints on employers. Thus, there could be what might be described as a pent-up demand for age discrimination in these states. A sharp downturn gives employers cover to engage in age discrimination.

    • During and after the Great Recession, business conditions and the need for labor may have been so uncertain that employers became especially wary of hiring older workers. They may have feared that if they had to lay off older workers, they would face wrongful termination claims based on age. Such claims could be more likely or more costly in states with stronger age discrimination laws.
Here’s my takeaway, in simpler words:

It’s no wonder trust between employees and their employers sucks so bad.

Originally published on BenefitsPro.com
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