3 minute read 29 Oct 2019
Enthusiastic senior businesswoman looking away in office

Why companies must be increasingly focused on ageism

By Michael van den Brand

EY Global Payroll Markets & EMEIA Payroll Operate Leader

Served on various international executive boards. Global citizen.

3 minute read 29 Oct 2019

People are living longer and delaying their retirement if they can. Here’s what to consider as the dynamics of the workplace shift.

The traditional view of retirement is changing fast. The combination of an aging population and increases in life expectancy, and the cost of living at retirement has contributed to the growth of an older workforce.

Older workers are an asset to the organization, given their experience and skills in their field. Many employers know the importance of having a diverse and inclusive workforce but may be overlooking age, making this topic the next frontier in diversity.

But such a shift will cause significant disruption throughout our society and economy. The impact on social-security and pension systems has been much discussed, but disruption should also be expected in workplaces where different generations bring different skills and hold different expectations. HR/payroll functions responsible for compliance with laws concerning accounting, retirement and age discrimination will also find themselves under additional scrutiny. The global considerations were spotlighted in a recent EY report (pdf).

Depending on where you do business, an older workforce can present several angles to consider when it comes to regulatory compliance. Companies are required to organize their employment culture, structure, processes, staffing, personnel development and their termination cases in accordance with age-specific risks, needs, qualifications, skills and abilities, always in compliance with statutory regulations and current legal practice.

For instance, in some countries, such as Sweden and Luxembourg, there are efforts to extend worker protections later in life and promote greater employment rates among seniors that could trigger new obligations for employers, and other rules address what mandatory retirement ages are appropriate.

When voluntary or compulsory retirement ages are in play, companies also need to schedule training to provide individuals near that age with information about the process and documents required by the social-security authorities. Employers face compliance obligations on social-security contributions and must correctly withhold and pay such contributions, so they must retain full records.

An aging workforce can lead to challenges: conflict between generations and a possible lack of adaptability in skills are just some of the potential concerns. Employers need to start thinking about how they will strike the right balance between age diversity, health and safety, and legal compliance to capture the benefits.

These companies must design their internal policies to encourage and keep older employees motivated to work. They should consider reskilling sessions for their older employees to help them in learning new technical skills. To attract older talent, companies could introduce flexible scheduling options, reward programs and part-time job opportunities.

So how will the employment-relations landscape cope, and what changes are needed to cater to this aging workforce? Some questions to consider:

  • How do we create a workplace which both attracts the aging workforce and allows it to be productive?
  • How do we retain older workers while ensuring that younger talent can be promoted and given increased responsibilities?
  • How do we make sure every generation in the workplace contributes in the best way possible for the best performance of the company?
  • How do we become “age-blind” — providing a true meritocracy regarding employees in a performance-based system, regardless of a person’s age?
  • How do we ensure a “soft landing” for elder workers?
  • Can you future-proof your payroll in your present working environment? Is it factoring in requirements from wherever you do business, in an efficient, digitally focused way?

These are many of the key questions related to the aging workforce that employers are facing today. But companies committed to sustainable age management will be rewarded with higher talent attraction, retention, productivity, less absenteeism as well as lower labor and litigation costs.


These are important issues for employers as they will need to take a more careful approach to the management of older workers and the end of careers. Understanding the desires of the aging workforce and the needs of the business — and well as the compliance obligations — will be key in devising an end-of-career strategy for each employee, and in equipping back-office functions to enable those strategies.

About this article

By Michael van den Brand

EY Global Payroll Markets & EMEIA Payroll Operate Leader

Served on various international executive boards. Global citizen.