“My raise was tiny. Illegal discrimination, or legal cost-cutting?”

Question: Hello. I have been with my present employer for over 28 years. I am now 50. I receive great performance evaluations, but this year’s raise was only one half of one percent. To make matters worse, half of it will not be counted for retirement purposes. 

I feel like it is age discrimination and they are trying to starve me out. Do I have a case?

Name Withheld
Leland, Missouri 

Answer: Dear Blog Visitor: Hello to you, as well. I chose to publish my answer to your question because so many blog visitors are asking similar questions lately. Here is my best answer.   

1. For there to be illegal “discrimination,” there must be an illegal “motivation” in your employer’s mind and heart. It is not illegal discrimination for an older person to receive a small raise, or to be demoted, or even to be laid off. Those unfortunate experiences can happen to anyone, at any age. However, if your boss said to himself or herself, “I am going to give him a small raise because I don’t like older people,” or “Deep in my heart, I know older people get sick more often, so I don’t think they are worth as much as younger people,” then it would be illegal discrimination, because of the discriminatory motivation for the act.  

2. How can you tell if you have a “case” of illegal discrimination? Since illegal discrimination is a matter of what is in the “mind” and “heart” of the employer, how can you see what is in an employer’s mind and heart? Actually, you cannot do that, even if you looked real hard in their ears, down their throats, or up their noses. However, you can figure out what is in employers’ minds and hearts by listening to what they say and watching what they do, because what they say and what they do is a reflection of what they think and feel.  

Let’s start with (a) what your employer says: if your employer goes around calling people in their 50’s and 60’s “old geezers,” or other negative things, then he or she probably does not view older workers with respect, and does not see them as valuable as they view younger employees. Likewise, if your employer keeps saying to older employees “You should not need much money, as your kids are all grown,” chances are the employer had age in his or her mind when deciding how much to give you this year as your raise. 

Now let’s look at (b) what your employer does. Most importantly, did older employees all receive lower raises than younger employees? Have more of the older employees been laid off than younger employees?  Have more of the older employees been denied promotions that were given to less experienced, and younger, employees? These acts would tend to paint a pretty strong pattern of different treatment depending on the ages of the employees, and thus indicated age was in the mind and heart of the employer when it decided on the small raise.  

3. If you are paid more than most of your younger colleagues, it is possible that a very small raise was given to you in order to urge you to resign, or get you angry enough to quit. This sort of seeming “discrimination” – where the employer targets those who are higher paid, and it is a fact that older employees are often higher paid – is a source of great debate among many people, including employees, employers, lawyers and Courts. While lowering overall costs is an entirely appropriate business objective, if doing so falls mostly on the shoulders of older employees, could it be “discrimination in disguise?” Courts are somewhat in disagreement over how to treat these circumstances, but are increasingly looking at each individual, and making a determination – illegal discrimination or legal cost-cutting – on a case-by-case basis, with a watchful eye toward “evident intent.” That is, they look at the other things that the employer is “saying” and “doing” to reach a decision on this issue of possible discriminatory intent. 

4. I think it is quite likely that you are experiencing what so many other people – young, middle aged and old – are experiencing, worldwide: lowered compensation for the same effort and performance. Not only am I reading about it, I am hearing about this trend on a daily basis from both clients and blog visitors. They are not only receiving lowered benefits, lowered bonuses, lowered commission payments, but even lowered salaries. This is on every “level,” from entry level to “C-Suite.” It is to the point that even some people are working for free – the “interns” – in most cases in violation of minimum wage laws.  

It seems like a matter of “supply and demand,” that is, few jobs and a lot people looking for them. While employers can’t sell more, and can’t raise their prices, they can engage in – and are – lowering compensation. In and of itself, it is not illegal. Demoralizing? Yes. Upsetting? Yes.

A real challenge? You betcha, as landlords, mortgage companies and those who sell us the food we eat are not lowering their prices at this time. Far from it. 

5. The one proven way to combat “income deflation” is to learn how to “navigate and negotiate” at work, which is what we teach in this blog. Even in this atmosphere of “income deflation,” some people are moving forward, climbing the income ladder, and achieving greater incomes and enhanced job security. It is a matter of pursuing and practicing our 7-step discipline, what we refer to as the SkloverMethod™ of workplace navigation and negotiation, which is fully explained more throughout our blogsite. As we often say, “Make yourself valuable, and negotiate that value, and all will be well.”   

I hope this has been helpful. Thanks for writing in.   

My Best,
Al Sklover

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