Friday, May 26, 2006

Commentary: Waste of Mandatory Retirement

Michael Willard, writing int The Ukranian Observer, chastises corporations as being rather myopic when it comes to judging value of an employee: "They often look at how expensive the person is, and feel sure a younger firebrand is up to the task of the job." Even in a country, such as Ukraine, where retiring at 60 is not unusual but mortality charts, particularly for males, extend just a few clicks beyond that age, Willard findds "many older Ukrainians not wishing to retire at 60 or 65."

Willard then went on to quote extensively from a speech given by Lord John Browne, CEO of British Petroleum, railing against mandatory retirement. Browne argues that (1) countries need people to work longer and need to ensure that the balance between those in work and those not working doesn't move to the point where the burden of taxation and transfer payments is intolerable, and uncompetitive, (2) mandatory retirement at a fixed age is inappropriate since more than 70% of the European economy is now based on services, rather than manufacturing, and (3) in key disciplines such as engineering, a disproportionate share of BP's workforce is over 45, and indeed over 50. More importantly, however, Browne argues that it "is the need for a civilized society to overcome prejudice" and that "too many people seem to think that it is still acceptable to say you've reached the age of 60: We don't want you any more."

Source: The Ukranian Observer "THE WORKPLACE: The Waste of It All" (May 2006)

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