After A Lifetime Of Hard Work, The Indignity Of A Layoff

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Posted: 03/24/2012 8:05 pm Updated: 03/24/2012 9:08 pm
by Arthur Delaney

Linda Hall of Spokane, Wash. has worked hard all her life but hasn't earned any respect from the labor market. Laid off for the first time at age 62, Hall has no health insurance, not enough savings for retirement and almost no chance of getting hired again.

"A year ago I was absolutely certain that I had job security," Hall said. "Change is a part of life. But, truthfully, until a few weeks before [getting laid off], I just didn't see it coming and couldn't imagine such a thing happening."

[...]

Baby Boomers like Hall are more likely than previous generations to keep working, or at least looking for work, as they get older. Since hitting a low of 29 percent in the 1990s, the labor force participation rate for older workers (those who are 55 and up) has risen to 40 percent today. The increase is partly due to employers offering stingier retirement plans than they once did.

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The unemployment rate for older workers is lower than for their younger counterparts, but older workers' unemployment spells last longer. The average jobless person aged 55 and over during 2011 spent a full year unemployed, compared with 39 weeks for the broader workforce. Older workers are more than twice as likely as their younger counterparts to be unemployed for 99 weeks or longer, according to the Congressional Research Service. In February, nearly 2 million of America's 12.8 million jobless had been out of work that long.

How does a person wind up in such a bad spot? It's not clear from the data. Education, surprisingly, doesn't provide guaranteed protection. The CRS found that unemployed workers with advanced degrees were no less likely than high school dropouts to become 99ers. Hall said she has a master's degree in education.

From the perspective of workers themselves, age discrimination is the obvious explanation.

[...]


Shortly after losing her job last July, she zeroed in on a catering position at the upscale Spokane Club.

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Hall had good reason to think she'd be a fit for the position: She'd worked at the club since 1993. Management was making her reapply for her own job.

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Then Hall encountered the final part of the application, which required her to sign a document laying out a new compensation scheme. It would cut her pay from $10.04 per hour to the minimum wage (at the time $8.67 per hour in Washington state). Additionally, management would begin taking 40 percent of the catering staff's tips, up from less than 10 percent previously. Hall said customers' bills would include a 20 percent "service charge" instead of the 18 percent gratuity the club used to charge, but the customers wouldn't know less money would be going to workers.

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Hall estimated the changes would cost her at least $10,000 a year, about a third of her income.

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Worker advocates sometimes call the kind of tip pooling scheme Hall encountered "tip theft." It's a common practice at places like hotels, stadiums and country clubs.

California, Massachusetts and New York have made it illegal to charge what customers would consider a gratuity but withhold the tips from workers, according to Restaurant Opportunity Centers United, a union group for service workers. Lawmakers in Rhode Island are considering a ban as well.

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Even if Hall had filed a discrimination claim, such suits are harder than ever for claimants to win. In 2009, the Supreme Court ruled that instead of having to prove age was a substantial factor in a demotion or firing, plaintiffs in age discrimination lawsuits must provide direct evidence that their age was the decisive factor -- something labor law experts say is extraordinarily difficult to do.

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Hall received a letter from the club stating that her position had been eliminated. But if the club wished her well, it showed it in a funny way. When Hall applied for unemployment insurance early in August, the club appealed the claim, and in September the state ruled her ineligible for benefits. She lawyered up.

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In November, an administrative law judge ruled in Hall's favor, allowing her to receive $428 per week in unemployment insurance. The letter from the Spokane Club stating that Hall's position had been eliminated likely helped. And even if she had left of her own accord, state law allows claims from quitting workers when a business reduces a worker's wages by 25 percent or more.

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"You give years of excellent service for members," she said, "and then they spit you out like a peach pit or something."


tags: age discrimination
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