This publication focuses on the challenges to management of dealing with older workers. Section 1 addresses motivating older workers who may perceive that their opportunities for promotion and increased earnings are limited. Six principles to guide this motivation are discussed: needs can be powerful motivators; to motivate, link need satisfaction to behavior; an important first step in linking need satisfaction to performance is to set specific, challenging, but reachable goals for the employee; after goals have been set and accepted, make sure employees have the means to achieve the goals; reward achievement; and improve motivation by changing the nature of the work. Section 2 on the influence of age stereotypes on work relationships describes a study that used a series of management problems to demonstrate how age stereotyping occurs in a business environment. Strategies for identifying and overcoming age stereotypes are suggested. Section 3 on managing the older worker makes recommendations for special situations when younger managers supervise older employees. These issues are considered: communications breakdowns, status uncertainties, obsolescence problems, overcoming resistance to change, and conflict management. The advantages and disadvantages of four styles of managing conflict are outlined: avoiding conflict, compromising, forcing, and problem solving. Section 4 considers creating alternative work arrangements for older workers. Contains nine references. (YLB)