Case Study on Principle #6 - Labour Principles

Eliminate discrimination in respect of employment and occupation

Name of Company: B & Q

Background & situational context
The British Do It Yourself (DIY) house improvement market place is a crowded one. 
Take any exit off the country’s busiest motorway, the M25, and you are likely to find a space in 
one of the vast car-parks surrounding an assortment of huge brightly coloured buildings bearing the 
names of Britain's leading DIY retailers: Focus Do It All, Homebase, Wickes, Great Mills and B&Q. 
Of these, B&Q plc is Britain’s leading DIY retailer with annual sales of $US3.9 billion, 
owning 13.5% of the repair, maintenance and improvement market share. 
Worldwide the company now employs over 35,000 employees and has sales of nearly $US6 billion. 
In addition to its economic prowess, B&Q is also now widely recognised as a corporate leader in the 
social, ethical and environmental arenas. 

One of B&Q’s pioneering corporate responsibility initiatives was introduced more than a decade ago. 
This initiative, started in 1989, was a pilot employment policy to promote the employment of older 
people and was one of the company’s first diversity initiatives. 

Problem 
Discrimination against people on the basis of age is not uncommon in the United Kingdom. The Institute for Employment Studies (IES) has found that between 25-34% of British employers use explicit age bars on jobs (IES in B&Q, 1995). The UK government itself has estimated that at least 40% of employers discriminate on the grounds of age (Ottaway, 1995). Whereas other European countries, including France and Spain, have age-related legislation (such as a ban on using age limits in job advertisements), the UK still has no legislation to prevent age discrimination. There are plans to change this policy as the Trade and Industry Department of Government are drafting changes in legislation. The proposed regulations are being brought under the European legislation on discrimination – and must be implemented by the end of 2006. 

B&Q and various non-governmental organisations (NGOs) argue that discriminatory employment practices related to age pay no attention to significant social and demographic changes such as the rapid growth in Britain’s ageing population. More than 40% of the UK workforce is currently over 45 years. Furthermore the past 15 years has seen a substantial decrease in the number of 20-24 year olds in employment. Ageism in the workplace creates physical and mental hardship not only for over 50s but also for their dependants. Contrary to public assumptions, research conducted by B&Q found that 58% of staff over 50 years had members of their family that depended on them financially and 16% had to care for relatives, mainly parents who were elderly or infirm (B&Q, 1995a). Commenting on the survey results, then B&Q Chairman, Jim Hodkinson said that: 
        “Increased life expectancy, a growing number of people not willing or able to rely on the state 
        to look after dependants and an increasing proportion of older people against a backdrop of a 
        falling number of school leavers; these are all factors which need to be considered in planning 
        recruitment policies.” 

Addressing the Problem
During 1989, recruiting from the core labour pool became more difficult for the company and it was forced to adopt more flexible policies with regards to hiring older employees. B&Q’s efforts to promote diversity in its workforce were therefore strongly rooted in commercial realities. The fact that older people were more likely to have knowledge and experience in the DIY trade, along with an urgent need to address changing UK demographics and the need for well-motivated retail staff, caused B&Q to launch its so-called Grey Revolution in 1989. B&Q’s Lorian Coutts explains that the initiative was a reaction to severe shortages in the labour market at the time: 
        “The adoption of our over 50s policy was, for the most part, a reaction to the changing job 
        market in the late eighties. They provided an under-used pool of labour.” 

Initially, the Board of Directors did have some concerns regarding older employees working with some of the more physically demanding aspects of the job and working with new technology. B&Q therefore decided to test the new programme with an initial job advertisement for 55 new employees for a store in Macclesfield, UK. After the programme proved very successful (see below), the company learnt that socially, as well as economically, having a larger representation of older labour is very beneficial for all parties concerned. 

In 1999 the company updated the retirement policy by removing restrictions around retirement to allow individuals the opportunity to review their own working life and reach a decision on based on their financial resources and family needs. 

Results 
When Warwick University initially evaluated the new store where people over 50 were hired, store against other stores it topped the list on most measures. In her independent review of the Grey Revolution initiative, Mandy Jetter (1993) notes the following achievements: “a massive reduction in unattributable stock loss, and a very low absentee rate, [and] the best sales award for the whole of B&Q. Other figures cited by B&Q to demonstrate the new over-50s store’s success compared to other B&Q retail outlets at the time include; 
        · Profits 18% higher 
        · Staff turnover 6 times lower 
        · Absenteeism 39% lower 
        · Shrinkage 59% lower 
        · Improved customer perception of service 
        · Increased skill base in the staff team 

B&Q has not continued to pursue an only-50s employment policy for specific stores. B&Q’s aim is simply “to achieve a balance of ages throughout the company to reflect the age profiles of communities in which the stores are based.” 

In order to build on the success of the pilot project, the company initially adopted an ‘over 50’ target of 10% of the workforce, this target was later revised to at least 15% of staff. Between 1991 and 1998, the percentage of employees that were over 50 years of age in B&Q stores rose from 7.3% to 13% (excluding temporary staff). Today, 18% of B&Q employees are over 50 years old and its oldest employee is 89. 

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UN Global Compact Resource Package