Rigzone Poll: Age Discrimination a Concern in Oil and Gas

Rigzone Poll: Age Discrimination a Concern in Oil and Gas
Two-thirds of poll participants report first-hand experience with age discrimination.

Age discrimination – or at least the perception of it – is a significant concern in the oil and gas industry, according to a recent poll on Rigzone’s Twitter page. In fact, 66 percent of the 1,603 survey participants selected “yes” when asked if they thought they have ever experienced age discrimination while searching for a job. The finding parallels more formal research cited by AARP that reveals a similar conclusion on a broader scale: the majority of U.S. workers surveyed have either seen or experienced age discrimination in the workplace.

As this U.S. Equal Employment Opportunity Commission (EEOC)-compiled list of pending and resolved cases under the federal Age Discrimination in Employment Act of 1967 (ADEA) shows, some examples of age discrimination by employers include:

  • Developing hiring criteria that exclude applicants above a certain age for managerial roles
  • Manipulating layoff criteria to target affected employees based on age
  • Extending a search to fill a vacancy in order to find someone younger than a more seasoned leading candidate

To be sure, there are limits – at least under U.S. law – regarding what actually qualifies as age discrimination, point out Alicia Locheed Goodrow and Terese Connolly, partners in the cloud-based law firm Culhane Meadows. Goodrow and Connolly – based in Houston and Chicago, respectively – noted that two examples of what falls outside the bounds of age discrimination include:

  • Terminating an employee who happens to be over 40 years old after the employer has compiled sufficient written documentation of consistently poor performance or misconduct – as long as others who consistently perform poorly and/or engage in the same or similar misconduct are treated equally.
  • Refusing to hire a highly experienced engineer who does not possess the technological skills necessary to perform the job and has expressed a lack of desire to learn such skills.

Nevertheless, Goodrow and Connelly said that employers need to tread carefully when making “adverse employment decisions.” Examples of such decisions include refusals to hire, demotions and terminations, and employers should contact legal counsel beforehand to ensure that they are complying with all applicable laws and regulations to mitigate risk, they said.

Read on for additional insights from Goodrow and Connolly regarding age discrimination, including how it can occur in the oil and gas industry and what proof is necessary if you think you’ve experienced it. (Note that their comments correspond just to the U.S. federal ADEA statute. Various individual states have their own variants of ADEA that are broader than the federal law – and the confines of this discussion.)

Rigzone: Broadly speaking, what is age discrimination and what isn't age discrimination in the context of employment? For instance, are there any rules-of-thumb that one can use to gauge whether discrimination has actually occurred?

Goodrow: ADEA protects individuals who are 40 years of age or older from employment discrimination based on age. The ADEA’s protections apply to both employees and job applicants. Under the ADEA, it is unlawful to discriminate against a person because of his/her age with respect to any term, condition or privilege of employment, including hiring, firing, promotion, layoff, compensation, benefits, job assignments and training. The ADEA permits employers to favor older workers based on age even when doing so adversely affects a younger worker who is 40 or older. The ADEA applies to employers with 20 or more employees.

Rigzone: What are some common ways in which age discrimination manifests itself in hiring, promotions and layoffs? Are there any examples unique to the oil and gas industry?

Goodrow: In the oil and gas industry, we more frequently encounter age discrimination issues in layoff situations than in hiring and promotion, though it can occur in all of those areas.

Over the past 20 years, it has become very common at the middle management through executive levels to structure early retirement buy-out plans when the price of oil dips and short-term profits look bleak. Often the large, multi-national companies have very generous benefits packages including historic employer-funded pension plans, generous vacation packages and premier health plans. Older employees with longer tenures are more expensive to keep on the payroll because of these benefits packages. It is possible to structure a non-discriminatory voluntary retirement plan that incentivizes older workers to retire.

The trouble comes in when the plans are not truly voluntary and come with penalties for electing out of the option to retire.

On the promotion/hiring side, the oil and gas industry currently has a skill-based generation gap in the engineering ranks. Generation X is often underrepresented because there are fewer Gen X employees with strong petroleum/energy engineering backgrounds. The Baby Boomers are retiring and the Gen Y and Millennials haven’t yet gained the practical experience to fill the gap. That means many companies want to keep the older workers involved longer to mentor and train. But it may also mean that the 40- to 55-year-olds are caught in the middle.

To prove an age-discrimination case, you need to show that you are part of a definable group and that some in that group are clearly favored over others for age reasons and not reasons related to performance, experience, tenure, etc. Age discrimination is based on outcomes more than environments. It is very hard to demonstrate that a “hostile work environment” has created an age discrimination right.

Connolly: With respect to hiring in industries across the board, when interviewing older workers, many biases can come into play. A common bias is the perception that older workers lack the technological skills. To avoid the unfortunate consequence of overlooking a candidate with extensive industry experience, employers would be wise to educate those employees in charge of hiring on their own biases in order to interrupt the bias. Ideally, hiring teams should consist of individuals from each generation.


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