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Age Discrimination Act: FAQs for Small Business Owners

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Age Discrimination Act: FAQs for Small Business Owners

By NicoleD
Published: March 23, 2010 Updated: February 10, 2011

What is the ADEA?

Job applicants and employees who are over the age of 40 are protected from age-based employment discrimination under the Age Discrimination in Employment Act (ADEA). The ADEA makes it unlawful for an employer to discriminate against a worker because of their age in typical conditions of employment, like interviewing, hiring, compensating, disciplining, terminating, or promoting.

While the ADEA intends to prevent employers from discriminating against older workers in favor of those under 40, it also prohibits discrimination between older workers. This means that an employer cannot hire Frank, 47, over Eric, 59, because Frank is younger.

Employees under the age of 40 cannot claim age discrimination under the ADEA.

Does my business have to comply with the ADEA?
The ADEA applies to employers with 20 or more employees, including federal, state and local governments, employment agencies, and labor organizations.

An employer may request that worker waive his/her rights or claims under the ADEA, either in the settlement of a claim, or in connection with an exit incentive program or other employment termination program. For more details on ADEA waivers, see the U.S. Equal Employment Opportunity Commission (EEOC) website.

Am I allowed to ask prospective employees their age?
Under the ADEA, an employer is entitled to ask an applicant's age or date of birth, but to avoid possible intent to discriminate, requests for age information should be made for lawful, relevant business purposes.

Aren't older employees more expensive to employ? What are the rules on benefits and retirement obligations?
The Older Workers Benefit Protection Act of 1990 (OWBPA), a supplement to the ADEA, specifically prohibits employers from denying benefits to older employees. Employers cannot reduce or limit health and life insurance or stop pension accrual of older employees based on the employee's age. The OWBPA also prevents employers from targeting older workers when downsizing or offering early-retirement packages.

Are age discrimination laws the same throughout the US?
The ADEA is a federal law, however many states also prohibit age discrimination. Some states merely reflect the ADEA, while others may protect a broader age range or apply to employers with fewer than 20 employees. Employers can contact their state EEOC branch for local fair employment requirements.

What should I do if I am cited for age discrimination?
The EEOC will notify an employer within 10 days of receiving a charge. Notification normally includes a copy of the charge briefly identifying the charging party, the basis and issue(s) of the allegation, and the date(s) of the alleged discrimination. To learn more about charges filed against your business, see the EEOC's guide on discrimination investigations.

It is unlawful for employers to retaliate against an individual for opposing employment practices that discriminate based on age or for filing an age discrimination charge under the ADEA.


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A foreign company establishes a startup LLC and hires a US citizen to manage the company which is performing well and growing. After successful startup and growth (of several years) the overseas parent company terminates the performing US manager (45) and brings in a younger parent company employee. The US LLC has less then 10 employees - the foreign parent is a mid-sized company. Is this age discrimination?
Interestingly enough, the article mentions that persons under the age of 40 cannot claim age discrimination, when it is a common fact that many young college grads are 'discriminated' against (if that is the right word, in favor of older 'experienced' workers fastest way to lose weightMessage Edited by NicoleD on 12-11-2009 03:56 PM
Age discrimination does exist, and here in Califronia, we are an at will state, which means people can be fired at will. I think that when you are young, it seems foolish to think an employer would fire soemone just for being older, but that is not always the case. I am older now, and though my technology skills are adequate, they are not necessarily as good as someone younger then I, however, many times my overall decision making skills are much better than some younger people. Not because I am necessarily smarter, but because I have more experience to back up the decisions I make.Samyouhuge.com
jroser - Thanks for your comment. To clarfiy, under the ADEA, it is illegal for employers to terminate an employee because of their age, but employers do have discretion to terminate employment for other reasons (including poor performance).Message Edited by NicoleD on 11-09-2009 10:33 AM
This is all wrong. The law is too good for employees. And they take advantage. There are some rare cases when employees are right. If you don't do a good job why should I care you are old or having 10 kids to feed. Yes there is an argument but still this is not comunism. Or it is? Weight loss naturallyMessage Edited by ZanetaB on 11-02-2009 12:57 PMMessage Edited by NicoleD on 11-09-2009 10:30 AM

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