Never ask an employee about their retirement plans.
We have all heard that gender-biased saying that you should never ask a lady about her age. Even more importantly, never ask an employee about their retirement plans.
A number of years ago, the Ontario Human Rights Code
was changed. It used to allow employers to discriminate against people over the age of 65. That upper age limit was removed in the belief that there was no valid reason for older workers to be treated differently than anybody else.
There are some exceptions. You can’t get Worker’s Compensation payments after age 65 and an employer’s benefits plan can discriminate based on age.
At the time this change occurred, some people thought the sky was going to fall. Turns out, it did not.
Some feared that it would be impossible to fire older workers without facing an age discrimination complaint. Employers contemplating terminating an older worker as a result of performance issues should be careful to document those issues. It is not that you are trying to establish just cause so that you don’t have to pay them any kind of severance at all. That is not the issue. But if an older worker claims they were let go even in part because of their age, you will want to have some documentation with respect to valid performance concerns. Just make sure that your expectations are being applied equally regardless of age.
If you have eight sales people and you want to let the oldest one go because of poor sales performance, they had better be the bottom one or two sales people when all the numbers are compared. Terminating the 69-year-old sales woman who is in the middle of the pack with respect to sales achievements may get you in hot water. If a human rights complaint is filed it will be up to the employer to show that the decision to end the relationship had nothing to do with age.
If you do have performance concerns with respect to an older employee, document them as if they were 27 years old. All your conversations should be as if that employee were 27. For the most part, my experience is that people don’t want to be mean or make others feel bad. Faced with a 20-year employee who is in their late 60s with declining performance, some employers say the wrong thing.
Instead of talking objectively about the performance issues they start to make inquiries about whether or not the employee has considered retirement. When the employee indicates they have no intention of retirement suddenly the documentation begins.
Think about it from the employee’s position: “I had been working there for 20 years and had never received any significant criticisms verbally or in writing. My last performance review was satisfactory or above. One day the boss asked me if I had given any thought to when I might retire and I said I was not even thinking about it. Two weeks later I received a warning letter for the first time in my 20 years documenting five different alleged performance issues. Two months later I was terminated for those issues. I was offered a severance package but now I want $25,000 in general damages and a much bigger severance for the violation of my right to be free from discrimination based on my age.”
The employer in this scenario is in an extremely tight spot and is likely going to have to negotiate some sort of a settlement. Protestations by the employer that they were just trying to be nice by asking about retirement will likely fall on deaf ears. The employer has dug a hole for themselves from which they will not emerge without writing a much bigger cheque than they would have if they had kept their mouth shut.
The lesson of the day is, never have that retirement conversation. Never ask an employee any time, anywhere, under any circumstances, if they have any retirement plans. If they bring it up, fine. Just make sure you document the conversation. Trying for the easier and nicer retirement way out of performance issues can be extremely painful to your pocketbook.
Ed Canning practices labour and employment law with Ross & McBride LLP, in Hamilton, representing both employers and employees. You can email him at firstname.lastname@example.org