Glad to be grey: legislation banning ageism in the workplace will take effect in 2006, but the smarter employers have already realised the business benefits of recruiting older people.(People Management)

Between them, supermarket giant Asda and HBOS, the parent company of Halifax and Bank of Scotland, serve tens of millions of customers a year, employ 200,000 people and have an asset sheet that stretches comfortably off to a place where every number is followed by at least nine zeros.

By any measure of size, these are huge companies. By any measure of achievement, they are successful. They also both have reputations for being hard-nosed organisations that aren't afraid to take a tough decision if the balance sheet and bottom line require it. So their latest attempts to keep ahead of the competition might come as something of a surprise. That's because Asda and HBOS have recently been making concerted efforts to weed out age discrimination in their workplaces and promote "age positive" policies where people are judged on their ability.

Asda's spokeswoman, Rachel Fellows, explains why the company has now become the UK's biggest employer of people aged over 50.

"A little while back we were opening a store in Broadstairs in Kent, which has a high percentage of older residents," she says. "We wanted to reflect the customer base, so we targeted that store to have half of its staff aged 50 or over. At the time there were a few nay-sayers who told us that the store's productivity would drop, that we'd have more absences, more staff off sick and less motivation. In fact, the reverse happened."

Asda decided to turn its discovery at Broadstairs into a national campaign to recruit older people. "Initially, we were aiming for around 16 per cent of our staff to be made up of over-fifties, but that's now risen to 19 per cent" Fellows says.

In part, Asda has been spurred on by the fact that the demographics of the country are changing. Already, 40 per cent of the population is aged 50 or over and that figure is set to increase. The imminent introduction of legislation that will outlaw age discrimination in the workplace in 2006 has also had an impact on its recruitment and working practices. "On the one hand, we are all living longer. On the other, we were going to have to do it sooner or later in any case," Fellows says. "Rather than wait until 2006, we wanted to adapt to the new legislation now and get ahead of the game:'

Asda has gone to great lengths to seek out older employees--even attending tea dances and bingo nights to find potential recruits. But the real effort has gone into creating a range of flexible ...