EEOC drives a stake into the heart of age-based retirement policies — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily

EEOC drives a stake into the heart of age-based retirement policies

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Question: Does your organization have a policy requiring employees to retire (or step down to a lesser position) once they hit a certain unbecoming age? Does that sound like your strategic succession plan—push your working geezers and geezeretts out the door so younger workers can climb the ladder? If so, a groundbreaking $27.5 million EEOC settlement last week shows that you better retire those policies … not the people.

Here’s why: The federal Age Discrimination in Employment Act (ADEA) prohibits employers from using policies or rules that require employees (over 40) to retire when they reach a particular age. In the past, some organizations believed they could skirt the ADEA by implementing partnership agreements that classified certain employees as “partners” under state partnership law. As partners, they’d be one of the firm’s “employers” and, thus, excluded from the ADEA. But that old t...(register to read more)

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