We previously wrote about how employers can make their workplace appeal to older workers and discussed returnship programmes as a way of supporting older workers returning to the workplace. We also flagged the benefits of training and retraining existing older staff. This article is going to take a deeper look at these areas with a focus on the practical considerations an employer will need to consider.
Training and reskilling
As discussed in our previous article, there are a myriad of ways to support older workers in the workplace. These measures can apply to both returners and existing older workers in the workplace. For example, it may be possible for employers to allow roles, including formal training programmes (which we discuss more below), to be done remotely or for the hours to be flexible.Learning and development are high on most employers’ agendas, particularly as technology in the world of work continues to develop at a fast pace, and use of artificial intelligence becomes increasing common in the workplace. Employers should consider how to best engage and train all workers and returners in technology based on personal needs to ensure they can work in the most effective way. Employers should also consider whether any additional training or support is required for any demographic in their workforce. The possibility of training and reskilling should be continuously explored with older workers, whether as part of a formal programme or through more informal discussions. To avoid age discrimination risks, managers should not make any assumptions about what training or upskilling opportunities older workers may be interested in.
Offering opportunities to re-train can be an effective way of continuing to support and retain older employees as their circumstances change. For example, some older workers may wish for their role to look different as they lead up to retirement and may not want to work at the same pace or invest the same amount of time. This can result in employees wanting to take on a new role which may require different skills. Employers should ensure they are not excluding anybody from recruitment or training opportunities (at any level) to avoid allegations of age discrimination.
How should employers approach discussions about training and reskilling?
As typical career-spans increase with age, companies should have an awareness of how traditional career paths may not be as fit for purpose now employees are expected to work for longer and many employees may embrace a job change in their midcareer. Approaching discussions about career paths and transitions, training wants/needs and re-training can be a challenge. The retirement age was abolished in the UK a number of years ago and so navigating such conversations can be difficult. Employers will understandably be keen to avoid exposing themselves to any age discrimination claims. Jumping straight into a conversation about any plans for retirement can be emotive and may damage the relationship with an employee.Employers should strive to have frequent and continuing discussions with all staff about career aspirations and possible internal trajectories, as well as further support or training which may be needed. Older workers do not need to be treated differently in this respect (and there is, of course, a chance any differing treatment could be seen as discriminatory, either against older employees, or younger employees, depending on the nature of the discussions). A key theme from the discussions in our Future of Work hub is that employers who want to retain older workers and have an inter-generational workforce should focus less on age brackets and more on the whole employee life cycle. Building in opportunities to discuss flexibility, training and development opportunities will help support employees at different points in their life. This will benefit not only older workers, but the whole workforce. The usual appraisal or review cycles are a natural juncture to have these continuing discussions. Employers could also consider building into their procedures periodic mid-life career reviews to discuss career aspirations and prospects.
Formal training programmes
Some employers are looking to proactively attract people returning from time away from the workplace, by offering formal returnship programmes. Although the focus on these programmes tends to be on attracting new employees, such opportunities could also be offered to existing employees looking to reskill or retrain, and who may otherwise look for opportunities elsewhere or think of giving up work altogether.
The concept of returnships was originally introduced by Goldman Sachs in the US in 2008 but over the years, this type of programme is increasingly an initiative we are seeing in large, global businesses. Returnships (or ‘returnerships’ as the government now refers to them) are supported programmes designed to be a stepping stone for people who are looking to return to the workplace after an extended break from work, such as parents returning from an extended period of family leave or older workers who are looking to re-enter the workforce.
One consequence of the pandemic was a wave of people quitting their jobs, leading to the ‘Great Resignation’. For younger generations, this was often in search of a career change, but this also contributed to an increase in the number of over 50s who are ‘economically inactive’. The cost-of-living crisis has caused some individuals to reassess their decision to leave the workplace and we are now seeing the ‘Great Return’ and the proportion of over 65s in the employment is now returning to pre-pandemic levels. As part of the 2023 budget, the chancellor confirmed plans to get people over 50 back into work, including the introduction of returnerships which the government said brought together existing skills programmes, including apprenticeships which would operate alongside existing sector-based work academies and skills bootcamps. Jeremy Hunt stated that this will help older workers both learn new skills and return to workplace
What do employers need to consider if implementing a returnership programme?
Before implementing a returnership programme, employers will need to consider a number of technical and practical points around how the programme will be set up and operated. Some of the key legal considerations are set out below:
- Is a returnership programme a type of apprenticeship?
The government have encouraged employers to utilise the existing apprenticeship scheme for older workers. The existing system promoted by the government is the Approved English apprenticeship system. These courses require apprentices to undertake work and off-the-job training to fulfil the requirements of a defined ‘Standard’ (with similar schemes in place in Scotland, Wales and Northern Ireland). Short returnership programmes would not fit into the existing statutory framework, as there is a requirement for an Approved English apprenticeship to be a minimum of 12 months in length.
Employers should also beware of naming any returnership programme an ‘apprenticeship‘, unless it fulfils the requirements of the Approved English apprenticeship. As explained in our Inbrief, this could cause the employment to fall into the old-fashioned ‘common law’ contract of apprenticeship category, under which the apprentice employee may have enhanced protection against dismissal. For that reason, we would recommend that employers pitch any returnership which does not work towards a Standard as an internship or simply a form of fixed term employment (see more on this below).
- Would funding be available for a returnership programme?
Employers may be able to use their apprenticeship levy funds or receive a subsidy on off-the-job training costs if the returnership programme operates as a statutory apprenticeship in its existing form, or the government legislates to include shorter programmes. Employers with a pay bill of over £3 million per year are required to pay the apprenticeship levy, which is a set rate of 0.5% of their total annual pay bill. Those employers have a digital account where they can spend their levy funds to pay for apprenticeship off-the-job training. It cannot be used for the employer’s on-the-job training costs, or any of the overhead costs of employing the apprentice (such as salary and benefits). Though smaller employers do not pay the apprenticeship levy, they benefit from the funding generated by it and receive a substantial subsidy for training fees. Apprenticeship funding is vastly underused and so employers who are happy to implement a lengthy returnership programme may want to explore the Standards available. Common law apprenticeships or ad hoc returnership schemes are not currently eligible for levy funding.
- What are the risks of operating a returnership programme for older workers?
Employers will need to consider at the outset whether such a programme is limited to older workers only. The most significant risk of introducing a specific age eligibility criterion is a direct age discrimination claim. This type of claim could come from a younger applicant who, for example, has also taken a period of time away from the workplace arguing that they have been treated less favourably because of their age.
Unlike other protected characteristics, direct age discrimination can be justified if the treatment is a proportionate means of achieving a legitimate social policy aim. Inter-generational fairness and dignity are legitimate, social policy objectives and this could include, for example, facilitating the participation of older workers in the workplace. However, the more difficult hurdle for employers to overcome is demonstrating that such a programme would be a proportionate way of pursuing such aims. The measures discussed above and in our previous article are arguably less extreme ways of achieving this aim and employers will need to think carefully about whether any such eligibility criterion is a proportionate step. Similarly, whilst employers might have scope for arguing that such a programme is a step to target underrepresentation (using lawful positive action), proportionality is still a relevant consideration which will be difficult to demonstrate.
- How can employers mitigate the age discrimination risks?
Given the age discrimination risks, employers should consider whether there is any benefit in limiting this type of scheme to those who meet a specific age threshold and how such a programme could also help achieve other diversity goals. As referred to above, there are other categories of workers who could benefit from such a scheme. This could include mothers who have taken a number of years out of the workplace for childcare responsibilities, workers who have had a significant period out of work for sickness or younger employees looking for a change of career path. If an employer is keen to put some limits on eligibility, a less risky course of action could be to introduce a minimum period the applicant has been either been economically inactive for or out of that industry or role.
- How long should a returnership programme be for?
In our experience, most returnerships offer successful applicants a fixed term contract. This can be a benefit to both parties. On the one hand, it allows employees to gain skills and confidence and ease the transition back into the workplace, with the prospect of a permanent job at the end. On the other hand, it allows employers to get to know the individuals and what skills they have in advance of offering a permanent role. In practice we see a variety of fixed term periods ranging from 12 weeks through to a year.
A returnership in the form of a statutory apprenticeship would currently need to be a minimum of 12 months. However, if the government introduces a formal returnership programme, it may decide that shorter periods are acceptable.
- What pay and benefits should a returner receive?
Any returnership programme should be paid and compliant with national minimum wage legislation. This is on the basis that the programme is not simply a 1-2 week work experience or work shadowing opportunity, which would generally be exempt from National Minimum Wage requirements. Returnership programmes tend to offer a lower starting salary for the fixed term period. This generally reflects the focus on training and bringing the employee up to speed. Salary may then increase when/if they move to a permanent contract.
Careful thought should be given to what benefits employees employed on a returnership programme should be entitled to. Those employed on a fixed term contract should generally not be treated less favourably than permanent employees, although all types of apprentices (both statutory and common law) are excluded from this protection.
- What training opportunities should be offered?
Returnership programmes will often have a significant focus on training. In addition to the considerations discussed above, employers should consider what existing training returners would benefit from and whether a separate training schedule should be implemented as part of the training programme. Statutory apprenticeships have compulsory off-the-job training built into their structure.
- What happens at the end of the returnership programme?
Although in practice returnership programmes tend to run for a short-term duration, many employers will offer opportunities for permanent employment at the end of a returnership programme. Clear communication around what will happen at the end of programme should take place at the outset and throughout, to ensure the returner’s expectations are well managed.
The non-renewal of a fixed term contract will amount to a dismissal. If the returner is an employee, they will not obtain unfair dismissal rights until they have two years’ service (although this could be set to change should Labour get into power next year). Employers should consider what notice periods they would require, in what circumstances they may want to terminate the relationship early and whether a probationary period would still be helpful.
It is also worth bearing in mind that – as mentioned earlier – those engaged under a common law apprenticeship will have enhanced dismissal rights.
What should employers do next?
Employers that promote and support diverse and age inclusive workforces will be well equipped to deal with supporting staff in their longer worker lives. Such measures will not exclusively benefit older workers but may help achieve broader diversity goals.
Employers should consider how to adapt their practices to embrace intergenerational workplaces. The initiatives we have discussed should be considered vital recruitment and retention tools by management as the trend towards an ageing population looks set to continue. An increased focus on the employees’ life cycle and openness to consider how an employee’s wants and needs can differ during different times will set up employers well to achieve this. However, real success of these initiatives will depend on having key stakeholders on board and the scheme being understood and respected within the company.
This article is the final one in our series of focusing on older workers. You can read the first on making workplaces appeal to older workers here, the second on ill health in the context of an ageing workforce here and the third on menopause at work here.
The impact of shifting demographics and ageing workforces on the world of work are considered in detail in this Ius Laboris report and this report from our Future of Work Hub initiative written by Employment Partner, James Davies, as well as in our latest podcast with Shruti Singh, Senior Economist at the OECD Directorate for Employment, Labour and Social Affairs. Visit our Future of Work Hub to find out more.