From the May 2005 issue of Entrepreneur

Rage Over Age

Boomers are aging gracefully on the job. Seasonally adjusted figures reveal that workers 55 and older landed 998,000 jobs last year, according to Chicago outplacement and research firm Challenger, Gray & Christmas Inc. Says CEO John Challenger, "The baby boomer population doesn't intend to retire like the previous generation."

Older employees, however, are raising tensions over pay increases. Consider Smith v. City of Jackson, where plaintiffs argue their employer's revamped pay plan gave larger raises to workers with less time accrued and therefore disproportionately rewarded employees under 40. The Supreme Court will decide whether employers discriminate when a pay proposal appears to have a negative impact on older workers. A decision is expected around press time.

But don't wait for the Supreme Court's verdict to understand the risks of adjusting salary packages, since Title VII laws currently apply to companies with over 15 employees. Be careful implementing pay changes. Document everything, and be able to justify pay increases.

Claims of ageism regarding pay will be a heated topic as hiring picks up. Says Adrienne B. Koch, a New York City attorney with Esanu Katsky Korins & Siger LLP, "A company can suddenly have to meet the market but can't raise [everyone's] salary."