IRS Issues Affordability Percentage Adjustment for 2020

Posted on July 24th, 2019

The Internal Revenue Service (IRS) has released Rev. Proc. 2019-29, which contains the inflation adjusted amounts for 2020 used to determine whether employer-sponsored coverage is “affordable” for purposes of the Affordable Care Act’s (ACA) employer shared responsibility provisions and premium tax credit program. As shown in the table below, for plan years beginning in 2020, the affordability percentage for employer mandate purposes is indexed to 9.78%.  Employer shared responsibility payments are also indexed.

*Section 4980H(a) and (b) penalties for 2019 and 2020 are projected.

**No employer shared responsibility penalties were assessed for 2014.

Under the ACA, applicable large employers (ALEs) must offer affordable health insurance coverage to full-time employees. If the ALE does not offer affordable coverage, it may be subject to an employer shared responsibility payment. An ALE is an employer that employed 50 or more full-time equivalent employees on average in the prior calendar year. Coverage is considered affordable if the employee’s required contribution for self-only coverage on the employer’s lowest-cost, minimum value plan does not exceed 9.78% of the employee’s household income in 2020 (prior years indexed above). An ALE may rely on one or more safe harbors in determining if coverage is affordable: W-2, Rate of Pay, and Federal Poverty Level.

If the employer’s coverage is not affordable under one of the safe harbors and a full-time employee is approved for a premium tax credit for Marketplace coverage, the employer may be exposed to an employer shared responsibility payment.

IRS Issues Affordability Percentage Adjustment for 2020

The Internal Revenue Service (IRS) has released Rev. Proc. 2019-29, which contains the inflation adjusted amounts for 2020 used to determine whether employer-sponsored coverage is “affordable” for purposes of the Affordable Care Act’s (ACA) employer shared responsibility provisions and premium tax credit program. As shown in the table below, for plan years beginning in 2020, the affordability percentage for employer mandate purposes is indexed to 9.78%.  Employer shared responsibility payments are also indexed.

*Section 4980H(a) and (b) penalties for 2019 and 2020 are projected.

**No employer shared responsibility penalties were assessed for 2014.

Under the ACA, applicable large employers (ALEs) must offer affordable health insurance coverage to full-time employees. If the ALE does not offer affordable coverage, it may be subject to an employer shared responsibility payment. An ALE is an employer that employed 50 or more full-time equivalent employees on average in the prior calendar year. Coverage is considered affordable if the employee’s required contribution for self-only coverage on the employer’s lowest-cost, minimum value plan does not exceed 9.78% of the employee’s household income in 2020 (prior years indexed above). An ALE may rely on one or more safe harbors in determining if coverage is affordable: W-2, Rate of Pay, and Federal Poverty Level.

If the employer’s coverage is not affordable under one of the safe harbors and a full-time employee is approved for a premium tax credit for Marketplace coverage, the employer may be exposed to an employer shared responsibility payment.

Note that as of January 1, 2019, the individual mandate penalty imposed on individual taxpayers for failure to have qualifying health coverage was reduced to $0 under the Tax Cuts and Jobs Act, effectively repealing the individual mandate. Although there is currently a lawsuit challenging the constitutionality of the ACA due to this change to the individual mandate penalty, the employer mandate has not been repealed and the IRS continues to enforce it through Letter 226J. The IRS has recently begun sending letters pertaining to calendar year 2017 reporting.

Next Steps for Employers

Applicable large employers should be aware of the updated affordability percentage for plan years beginning in 2020. Although the affordability percentage has not decreased significantly from 9.86% to 9.78%, employers should consider it along with all other relevant factors when determining contributions.

 

About the Author.  This alert was prepared for Alera Group by Marathas Barrow Weatherhead Lent LLP, a national law firm with recognized experts on the Affordable Care Act.  Contact Peter Marathas or Stacy Barrow at pmarathas@marbarlaw.com or sbarrow@marbarlaw.com.

The information provided in this alert is not, is not intended to be, and shall not be construed to be, either the provision of legal advice or an offer to provide legal services, nor does it necessarily reflect the opinions of the agency, our lawyers or our clients.  This is not legal advice.  No client-lawyer relationship between you and our lawyers is or may be created by your use of this information.  Rather, the content is intended as a general overview of the subject matter covered.  This agency and Marathas Barrow Weatherhead Lent LLP are not obligated to provide updates on the information presented herein.  Those reading this alert are encouraged to seek direct counsel on legal questions.

© 2019 Marathas Barrow Weatherhead Lent LLP.  All Rights Reserved.

Choosing a Vision Insurance Plan Your Employees Will Value

Posted on July 23rd, 2019

A good, quality vision plan is a valuable asset for your employees. The National Eye Institute reports that 66 percent of adults need vision correction. Health care providers say that routine eye exams are essential for preserving vision and safeguarding eye health. Vision insurance and vision benefits plans can make routine eye care more affordable.

Vision insurance differs from health care coverage because it does not fall under Affordable Care Act rules and regulations. That gives you more leeway when choosing a plan that best fits your employees’ needs and budgets. Group health plans, however, must include a provision for pediatric vision services. Insurance premiums usually are deducted directly from employees’ paychecks.

The cost of vision insurance for your company will depend on plan design, the state where your business is located, and your company’s size. Anthem data from 2018 pegs the cost of most vision plans – including eye exam and eyeglasses or contact lens coverage – at $10 or less per individual per month. 

When you purchase vision insurance, you are purchasing two products:

  • Access to a network of eye care providers, including optometrists or general ophthalmologists, who have agreed to provide services and/or products at a reduced cost. According to a consumer study commissioned by EyeMed, employees are most interested in seeing the doctors they want and shopping where they want for frames. 
  • Basic eye care services and products, such as annual eye exams, eyeglasses frames and lenses and contact lenses.

Many group vision plans have a monetary cap on more expensive services such as eye surgery and advanced procedures, or provide a discount or don’t cover them at all. Insurance providers usually pay up to a certain amount, and the patient pays the rest of the bill.

For more information on what type of vision benefit plan would be best for your employees, talk to your broker, benefits consultant or insurance plan carrier.  

IRS Expands HSA Preventive Care Safe Harbor to Include Chronic Conditions

Posted on July 19th, 2019

IRS Expands HSA Preventive Care Safe Harbor to Include Chronic Conditions

On July 17, 2019, the Internal Revenue Service (IRS) released Notice 2019-45, which expands the definition of preventive care benefits that can be provided by a high deductible health plan (HDHP) to include certain chronic conditions.  The guidance in the Notice may be relied upon immediately.  In general, most HDHP participants may establish and contribute to a health savings account (HSA), unless there is disqualifying coverage—such as having other medical benefits available besides preventive care before the minimum annual deductible is satisfied.

Overview

Under Section 223(c) of the Internal Revenue Code (Code), an HSA-qualified HDHP is not required to impose a deductible for certain preventive care services. This preventive care safe harbor includes services such as annual physicals, well-child care, and immunizations. Notably, prior to the Notice, preventive care did not include any service to treat existing illnesses, injuries, or conditions. Likewise, drugs or medications were treated as preventive care only when taken by a person who has developed risk factors for a disease that has not yet manifested itself or has not yet become clinically apparent (i.e., the individual is asymptomatic) or when the drugs are taken to prevent the recurrence of a disease from which a person has recovered.

Ultimately, the goal of the preventive care safe harbor is to encourage HDHP participants to receive routine care with a lower cost barrier, which should lead to better health outcomes.  By expanding the list of medical services that can be classified as preventive care, the IRS recognizes that cost barriers for care have resulted in some individuals with certain chronic conditions failing to seek care that would prevent exacerbation of their condition, which can lead to consequences such as amputation, blindness, heart attacks, and strokes that require considerably more extensive medical intervention.

In the Notice, the IRS expands the definition of preventive care to include coverages for specific chronic illnesses, in order to encourage necessary care and mitigate the consequences of not receiving care. It is also pursuant to President Trump’s executive order released on June 24, 2019, which instructs the agencies to allow HSAs to cover other low-cost preventive care to help maintain health statuses of participants with chronic illnesses. Such conditions will be considered preventive care only if the care is for one of the conditions listed below, and only when the care occurs for the purpose of preventing exacerbation of the condition or development of a new, secondary condition. Any care, services, or conditions not listed within the Notice (or other IRS guidance) will not be treated as preventive care and will not be permitted under the preventive care safe harbor.

Preventive Care under Code Section 223 now includes the following care and conditions:

Preventive Care for Specified Conditions For Individuals Diagnosed with
Angiotensin Converting Enzyme (ACE) inhibitors Congestive heart failure, diabetes, and/or coronary artery disease
Anti-resorptive therapy Osteoporosis and/or osteopenia
Beta-blockers Congestive heart failure and/or coronary artery disease
Blood pressure monitor Hypertension
Inhaled corticosteroids Asthma
Insulin and other glucose lowering agents Diabetes
Retinopathy screening Diabetes
Peak flow meter Asthma
Glucometer Diabetes
Hemoglobin A1c testing Diabetes
International Normalized Ratio (INR) testing Liver disease and/or bleeding disorders
Low-density Lipoprotein (LDL) testing Heart disease
Selective Serotonin Reuptake Inhibitors (SSRIs) Depression
Statins Heart disease and/or diabetes

 

Impact on Employers and Plan Participants

Employers and plan sponsors that offer an HSA-qualified HDHP, and their participating employees, should understand which conditions and services are now included under the preventive care definition.  While use of the expanded safe harbor is voluntary, we expect that many plans will adopt it.  The expanded safe harbor could benefit employers—especially those with self-funded plans—and allow for further cost-savings by covering chronic illnesses before a deductible is met.

 

About the Author.  This alert was prepared for Alera Group by Marathas Barrow Weatherhead Lent LLP, a national law firm with recognized experts on the Affordable Care Act.  Contact Peter Marathas or Stacy Barrow at pmarathas@marbarlaw.com or sbarrow@marbarlaw.com

The information provided in this alert is not, is not intended to be, and shall not be construed to be, either the provision of legal advice or an offer to provide legal services, nor does it necessarily reflect the opinions of the agency, our lawyers or our clients.  This is not legal advice.  No client-lawyer relationship between you and our lawyers is or may be created by your use of this information.  Rather, the content is intended as a general overview of the subject matter covered.  This agency and Marathas Barrow Weatherhead Lent LLP are not obligated to provide updates on the information presented herein.  Those reading this alert are encouraged to seek direct counsel on legal questions.

© 2019 Marathas Barrow Weatherhead Lent LLP.  All Rights Reserved.

Alera Group Acquires Landmark Benefits, Inc.

Posted on July 19th, 2019

Alera Group, a leading national insurance firm, today announced  its acquisition of Landmark Benefits, Inc. (Landmark), effective July 1, 2019. Terms of the transaction were not disclosed.

Landmark, located in Windham, New Hampshire, is an employee benefits broker providing comprehensive insurance benefits, human resource consulting, compliance, and wellness to clients throughout the United States. Landmark’s vision is to become the most sought after employee benefits company based on their expertise, innovation, and solutions and their partnership with Alera will further this long term objective.

“Landmark is an excellent addition to Alera Group as we grow our expertise and presence throughout New England,” said Alan Levitz, CEO of Alera Group. “Tom brings his national recognition and a terrific team to add to the collaborative effort of enhancing the client experience within Alera Group.”

“As an Alera Group company, we’re more equipped than ever before to provide our clients with comprehensive, innovative benefits plans,” said Tom Harte, Managing Partner of Landmark. “We look forward to combining powerful local relationships with the national resources of Alera Group to continue to serve our community.”

All Landmark employees will continue operating out of the firm’s existing locations under the name Landmark Benefits, an Alera Group Company, LLC.

Alera Group was formed in early 2017 and is one of the nation’s foremost independent insurance agencies. For more information on partnering with Alera Group, visit Partner With Us at www.jmjwebconsulting.com.

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About Alera Group
Based in Deerfield, IL, Alera Group’s over 1,700 employees serve thousands of clients nationally in employee benefits, property and casualty, risk management and wealth management. Alera Group is the 15th largest privately held firm in the country. For more information, visit www.jmjwebconsulting.com or follow Alera Group on Twitter: @AleraGroupUS.

M&A Contact
Rob Lieblein, Chief Development Officer
Email: rob.lieblein@aleragroup.com
Phone: 717-329-2451

Media Contact
Jessica Tiller, Weiss PR
Email: jtiller@weisspr.com
Phone: 443-621-7690

Who Needs Product Liability Insurance?

Posted on July 18th, 2019

If you manufacture, sell or distribute any kind of product, you probably need some kind of protection from product liability claims. 

What Does Product Liability Insurance Cover?

Product liability insurance protects the manufacturer, distributor or seller of a product from legal liability resulting from a defective condition that caused personal injury or damage associated with the use of the product. It is designed to protect your business from legal and court costs.

The kinds of costs incurred in defending a product liability claim can be extensive. They include defense, litigation and medical cost containment. In addition, there can be expenditures for surveillance, litigation management as well as fees for appraisers, private investigators, hearing representatives and fraud investigators.

Even if it is questionable whether insurance coverage applies in some cases, there can be considerable attorney legal fees owing to a duty to defend. Defense costs as a percentage of the total claim are relatively high in product liability insurance, reflecting the high cost of defending certain types of lawsuits, such as medical injury cases and class actions against pharmaceutical companies. In 2017, in addition to paying out $940 million in product liability damages, insurers spent $648 million in defense costs, equivalent to 68.9 percent of the losses.

A related insurance, product recall insurance, is designed to cover the costs associated with recalls, and is available from some insurers.

What Kinds of Businesses Need Product Liability Insurance?

Any small business that produces and sells a product should have this type of coverage, including:

•   Bakeries

•   Clothing stores

•   Florists

•   Restaurants

•   Gift shops

•   Wholesalers

•   Specialty food stores

•   Coffee shops

•   Pet stores

•   Print and copy shops

 

Keep in mind that product liability claims are not only a risk for business-to-consumer operations, but also business-to-business operations. If you produce a product that you sell to other business owners, you still need product liability insurance. Some of these businesses would include:

•   Software developers

•   Website creators/designers

•   Raw material suppliers

•   Equipment suppliers

Do I need Product Liability Insurance?

Travelers Insurance 2015 Business Risk Index showed that legal liability, including for incidents involving products, was the fourth-highest rated worry for business leaders in the United States, down from No. 3 a year earlier. Of 1,210 business leaders surveyed, 56 percent indicated they worry about it somewhat or a great deal.

Even if the products you manufacture, sell or distribute appear entirely safe, there’s always the potential for something to go wrong. Accidents happen. Claims of personal injury or property damage arising from product use (or product failure) can be expensive. Even if you’re not at fault, you may still incur considerable legal costs while defending yourself.

Most lawsuits are settled out of court. Of those that are tried and proceed to verdict, Jury Verdict Research data show that in 2013 the median, or midpoint, plaintiff award in personal injury cases was $68,218, down 9 percent from $75,000 in 2012; in California in 2018 the median was $114,305.

Stringent quality control and other risk management procedures are first and best defenses against product liability concerns, but insurance is an important component of a sound strategy

If you have a general liability policy, product liability insurance is covered in conjunction with liability for work that has been completed. This kind of coverage, which is included in bodily injury and property damage liability, is a combined piece of protection known as products-completed operations ability. Typically, when an insurance company issues a general liability policy to a business, it has taken into account its products liability exposure and is providing the products liability coverage deemed appropriate. However, depending on the nature of the products you make, sell or distribute, you may need more extensive products liability coverage.

Please contact us if you would like more information about products liability insurance and your business. 

The Lure of Workplace Flexibility

Posted on July 16th, 2019

The concept of a flexible workplace is based on the idea that it’s possible to work harder and smarter away from the office or during a shorter workweek. The question most employers have is, “Will it work?”  

Supporters say the benefits of a flexible workplace include better work-life balance; improved employee morale; lower turnover rates; decreased burnout; increased creativity; and loyal employees who give maximum effort to meet managers’ expectations. They also say that tailoring work environments and cultures to employees’ needs can attract talent.

Employers interested in a flexible workplace may wonder how they can maintain high productivity and performance levels in a less bureaucratic setting. Can flexibility and productivity be balanced?

Employers who have made the flexible workplace concept work for their company say that to make it work you must start slowly. The Svartedalens nursing home in Gothenburg, Sweden, selected employees to participate in an experiment to see if 30-hour weeks would be a good fit for the company and its employees. Employees worked six-hour days instead of eight for the same pay. The New York Times reported that early results were promising, showing reduced absenteeism, improved productivity and better worker health.

Types of Flexibility

Not all employees want to or are able to work 40 hour weeks. Flextime options include:

•    Part-time employment is defined as workweeks that are between 10 to 30 hours. Often, two employees share a full work week. This type of schedule is particularly appealing to university students and working mothers who need time to study or take care of their children. Employers, having difficulty filling a position, can sometimes more readily find two part-timers to fill a position

•    Telecommuting allows employees to work away from the office — whether at home or in a coffee shop or park. Telecommuters can be either full or part-time. Telecommuting saves employees the cost of gasoline and vehicle upkeep, as well as clothing and eating out costs. Employers avoid the cost of providing office space, equipment, paper, and electricity.

•    Freelancing is when an individual is hired for a specific project on a seasonal, full or part-time basis. Hiring a freelancer saves the employer the cost of paying full-time wages and benefits, while the individual reserves the right to choose only the jobs that interest them.

•    Flexible work hours allow employees to choose the hours they want to work. Employers usually define a core time that must be covered and employees can choose when to start and leave their shifts.

Minimizing Risks

Experts recommend employers have a clear goal of what they want to accomplish. For example, is the main focus improved productivity, happy employees or reduced energy costs? (Coincidentally, lower prioritized goals will often be achieved as well.)

When you decide on a goal, test the concept with your employees. Let’s say your goal involves going to a four-day workweek. If your plan is for everyone to work 10-hour days to get one extra day off each week, you might find some resistance. Working 10-hour days means less time to run errands on those days and can make arranging childcare more difficult. It also can leave employees more tired.

Or, shortening the number of hours worked, but also reducing wages, could be met with resistance. On the other hand, one employer, a web-based software development firm in Chicago, Ill., found they could give employees Fridays off without the need to reduce wages because they discovered people got the same amount of work done, but were happier and more focused.

One of the biggest concerns employers have is how to best serve customers to be sure they get the attention they need and deserve — even if employees are working away from the office or are working shorter weeks. Consider staggering working hours so key office hours are covered. Some companies schedule employees 80 hours over nine business days, which gives them an extra day off every two weeks. The key is not to have all employees take the same days off. 

10 Tips for Your Hurricane Insurance Claim

Posted on July 12th, 2019

Natural disasters—particularly hurricanes—can be extremely stressful to navigate, both throughout the storm itself and then following the event.

After the wind has subsided and the rain has stopped, you’ll need begin the process of reporting your claim to your insurance agent and your insurance company. Stay engaged with your agent and the insurance company adjuster as you work through the claim adjustment process.

Here are the top 10 things to do to make this process as smooth as possible:

  1. Document your damage with photos or videos as soon as possible.
  2. Protect your property from further damage and make temporary repairs, if possible. Your policy requires you to make every effort to protect the property from suffering additional damage but do not begin permanent repairs. This may mean placing a tarp over the roof or boarding up broken windows and doors.
  3. If the property is structurally unsound or unsafe you must report this to your local police and fire department.
  4. Contact a professional and capable mitigation company to abate any water and/or smoke damage. Your insurance agent will be able to recommend a resource for you.
  5. Secure the property as necessary.
  6. Maintain a record of all expenses incurred in protecting the property and provide this information to your insurance adjuster.
  7. Separate damaged from undamaged business and personal property if at all possible. Do not discard of any damaged property as your insurance adjuster will want to inspect these items.
  8. Prepare an inventory of the damaged Business Personal Property. Provide a detailed description of the damaged items, list the quantity and your estimated value of the damaged items. Include any available bills, receipts, appraisals and any related documents that will support your valuation.
  9. Do not dispose of the damaged property until your claims adjuster approves of the disposal. The adjuster will need to inspect the property and determine if there is any salvage value for the items.
  10. Be prepared to provide additional information requested by your claims adjuster.

Typically, hurricanes bring major property damage through flooding. Flood damage is typically excluded by most property insurance policies, so you will want to carefully review your particular policy with your agent to determine if Flood is a covered cause of loss. 

To successfully navigate the property claims process, it is vital that you work closely with your independent insurance agent and the insurance adjuster assigned by your insurance carrier.

Hurricane season an important reminder to business owners that unexpected loss and damage can occur at any time, particularly by external forces that can’t be controlled. Having an emergency plan in place to combat unexpected loss and damage is key to remaining successful in the face of disaster.

Alera Group Acquires Austin & Co., Inc.

Posted on July 11th, 2019

Deerfield, IL — Alera Group, a leading national insurance firm, today announced its acquisition of Austin & Co., Inc. (Austin & Co.), effective July 1, 2019. The firm expands Alera Group’s employee benefits and property & casualty expertise. Terms of the transaction were not disclosed.

Austin & Co., located in Albany, New York, has served clients throughout the Northeast for more than 165 years. Their service offerings include employee benefits, commercial and business insurance, and HR consulting services. Austin & Co. has a particular emphasis in designing unique program offerings for the education community.

“Austin & Co. is an exciting addition to Alera Group.  The management team has a great deal of experience and expertise and will be welcome partners within our collaborative culture,” said Alan Levitz, CEO of Alera Group. “Their local reputation as an outstanding firm immediately adds to our presence in the northeast and brings additional regional and national capabilities, elevating the Alera Group client experience.”

“Joining Alera Group is a thrilling opportunity for our firm as we continuously strive to serve our clients with the industry’s leading solutions and expertise,” said James Sidford, President of Austin & Co. “The collaborative culture of Alera Group will allow us to continue to exceed our clients’ expectations, while growing and strengthening the deep relationships we have in our local community.”

All Austin & Co. employees will continue operating out of the firm’s existing locations under the name Austin & Co., an Alera Group Company, LLC.

Alera Group was formed in early 2017 and is one of the nation’s foremost independent insurance agencies. For more information on partnering with Alera Group, visit Partner With Us at www.jmjwebconsulting.com.

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About Alera Group
Based in Deerfield, IL, Alera Group’s over 1,700 employees serve thousands of clients nationally in employee benefits, property and casualty, risk management and wealth management. Alera Group is the 15th largest privately held firm in the country. For more information, visit www.jmjwebconsulting.com or follow Alera Group on Twitter: @AleraGroupUS.

M&A Contact
Rob Lieblein, Chief Development Officer
Email: rob.lieblein@aleragroup.com
Phone: 717-329-2451

Media Contact
Jessica Tiller, Weiss PR
Email: jtiller@weisspr.com
Phone: 443-621-7690

Meaningful Ways to Support an Aging Workforce

Posted on July 9th, 2019

America’s workforce is aging rapidly — and it will have an impact on your business.

Baby boomers were born between 1944 and 1964 and currently are between 55 to 75 years old. About 10,000 baby boomers are turning 65 every day — a trend that started in 2011 — according to the Society of Human Resource Management (SHRM). At that rate, the U.S. Census Bureau estimates that the 65-and-older population will nearly double over the next three decades from 48 million to 88 million by 2050.

An aging workforce means that employers will need to fill the talent gap left by retiring baby boomers with younger workers who have the skills to replace them. Employers also will have to determine how to best meet the needs of an aging workforce postponing retirement.

Studies indicate that many employers are not prepared for this significant transition. A SHRM survey in 2016 revealed that only 35 percent of U.S. companies had analyzed the near-term impact of older workers leaving the workforce. A 2018 study by the Transamerica Center for Retirement Studies (TCRS) found that employers often think they are more prepared to handle this phase than their workers think they are. Eighty-two percent of employers said their company is supportive of its employees’ working past 65, while only 72 percent of workers agree that their employer is supportive.

Repercussions

While age 61 to 65 is considered the typical age range to retire, many older Americans are retiring later. A few reasons for postponing retirement include:

•    Finances: Many retirement-age workers can’t afford to retire because they haven’t saved a sufficient income for retirement. While there’s no magic number an individual should save, conventional wisdom is that new retirees should have saved $1 million to $1.5 million or have savings equal to 10 to 12 times their current income. Other retirees had saved enough, but the 2008 financial crisis left many with debt and/or insufficient income from their retirement savings.

•    Health: Emotionally, physically and spiritually, many 60-year-olds feel much younger than their chronological age. People also are living longer. The average American can expect to live to be at least 78.6 years, according to the National Center for Health Statistics.

•    They’re Needed: The generation after the boomers has been called the Baby Bust because fewer babies were born. That means there are fewer people to step up with the result that employers often ask older workers to stay and work longer.

•    Productivity: Many people enjoy working for both the mental stimulation and social opportunities. Jonathan Rauch is a senior fellow at the Brookings Institute and author of “The Happiness Curve: Why Life Gets Better After 50.” He said that people in their 60s feel they have another 15 years of productive life ahead and ”they don’t want to just hang it up and just play golf.”

Seniors who stay in the workforce can face discrimination from their employers and co-workers. The belief among many employers, TCRS found, is that older workers are less open to learning and new ideas. However, the SHRM Foundation, a nonprofit affiliate of SHRM, believes most mature workers are highly receptive to skills training opportunities, especially for job-related skills.

Other biases include the perception that older workers are less flexible, less motivated and too slow and take more sick days. Like all stereotypes, these criticisms may be valid in some cases, probably not warranted in most and often offset by other important qualities.

In 2018, the Equal Employment Opportunity Commission (EEOC) issued a report that found although it’s been 50 years since the Age Discrimination in Employment Act (ADEA) was passed, age discrimination is still a significant problem. Similarly, a 2018 Transamerica Center for Retirement Studies (TCRS) report indicated that many employers felt that workers 64 or older were too old to hire and workers age 70 were too old to work. About 60 percent of seniors who lose their job end up retiring involuntarily because they cannot get replacement jobs, according to the Center for Retirement Research at Boston College.

Strategies

An aging workforce is something all companies will have to confront very soon. Either there will not be enough younger employees with the necessary skills or workers will have to work longer to save more money for their retirement. The upside is that by adopting business practices that support workers of all ages, employers will have a diverse workforce with a variety of important skills.

The Equal Employment Opportunity Commission (EEOC) recommends that employers consider including age in their diversity and inclusion programs. Other suggestions include providing:

•    Career counseling, training and development opportunities for workers of all ages and at all stages of their careers.

•    Mixed-age and reverse-age mentoring opportunities.

•    Flexible work options to provide work/life balance as needed by employees at various times in their careers and in their lives.

•    Phased Retirement Programs for older employees who want to continue working but with a less stressful workload.

Succession training also is an important step. Even if your older workers stay past the traditional retirement age, they will eventually retire. This means you’ll need to recruit a new generation ready to take over from their predecessors. It’s important for older colleagues to pass along their knowledge to reduce the skill gap. 

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