Today the Equal Employment Opportunity Commission (EEOC) releases new regulations that will define employers' "reasonable factors other than age" or "RFOA" defense under the Age Discrimination in Employment Act (ADEA). The new regulations would reflect two Supreme Court cases interpreting the RFOA defense: Smith v. City of Jackson (2005) and Meacham v. Knolls Atomic Power Laboratories (2008). Click here to read the EEOC's Proposed ADEA Regulations.
The Supreme Court held in Smith that employment practices having a disparate adverse impact on workers age 40 and older may violate the ADEA. The Court in Meacham then ruled that when a plaintiff proves such an adverse impact, employers have the burden of proving that the practice that caused the adverse impact was based on reasonable factors other than age.” Since Smith and Meacham, however, there have not been any interpretive regulations under the ADEA to guide employers on the RFOA defense.
The proposed rule defines a "reasonable factor other than age" as "one that is objectively reasonable when viewed from the position of a reasonable employer (i.e., a prudent employer mindful of its responsibilities under the ADEA) under like circumstances. To establish the RFOA defense under the new rules, an employer must show that the employment practice was both (1) reasonably designed to further or achieve a legitimate business purpose and (2) administered in a way that reasonably achieves that purpose in light of the particular facts and circumstances that were known, or should have been known, to the employer. The rule also provides a non-exhaustive list of six factors relevant to determining whether an employment practice is "reasonable":
- Whether the employment practice and the manner of its implementation are common business practices;
- The extent to which the factor is related to the employer’s stated business goal;
- The extent to which the employer took steps to define the factor accurately and to apply the factor fairly and accurately (e.g., training, guidance, instruction of managers);
- The extent to which the employer took steps to assess the adverse impact of its employment practice on older workers;
- The severity of the harm to individuals within the protected age group, in terms of both the degree of injury and the numbers of persons adversely affected, and the extent to which the employer took preventive or corrective steps to minimize the severity of the harm, in light of the burden of undertaking such steps; and
- Whether other options were available and the reasons the employer selected the option it did.
The EEOC's proposal also explains that the RFOA defense turns on the facts and circumstances of each particular situation and whether the employer acted prudently in light of those facts.
An employer who is considering a change in employment practices -- such as a layoff, change in employment qualifications, etc. -- should examine the impact of the change to determine whether it may create an adverse impact based on age. If it appears that it may, the employer should then apply the EEOC's six factors to see if it can adequately defend the change as based on reasonable factors other than age. If the change does not appear to pass each of the EEOC's six factors, the employer may want to consider altering the change to reduce the impact or abandoning it altogether.
Yesterday the United States Supreme Court ruled 5-4 that trial courts may not use a "mixed motive" framework in federal age discrimination cases. Rather, plaintiffs in age discrimination cases must prove that "but for" their age, they would not have been discriminated against. Click here to read the Court's decision in Gross v. FBL Financial Services.
Under a 1991 amendment to Title VII of the Civil Rights Act of 1964, plaintiffs may prove race, sex, religion or national origin discrimination by proving either they would not have been discriminated against "but for" their employer's unlawful motive, or if their employer had a "mixed motive," meaning that the employer had some lawful motives to take an adverse action against the employee, but also some unlawful motives. In "mixed motive" cases, employers can avoid some (but not all) liability by proving that it would have taken the same action against the employee even absent the unlawful motive. Prior to Gross, several circuit courts (including the Ninth Circuit Court of Appeals) had applied the "mixed motive" framework in cases under the Age Discrimination in Employment Act or the Americans with Disabilities Act, even though those statutes do not incorporate a"mixed motive" framework.
Gross is ultimately a technical case mostly of interest to employment litigators. Gross will make it incrementally more difficult for plaintiffs to prevail in age discrimination and some other federal discrimination cases. Employers do not need to change their current policies and practices in light of Gross - rather, employers should continue not to discriminate on the basis of age, sex or any other characteristic protected by federal, state or local law. (Well, duh!)
What do terms like "feisty," "spry," "elderly" and "grandmotherly" have in common? Yes, they are commonly used to refer to older people; but they can be used to express derogatory stereotypes about someone because of age.
An article in today's New York Times, "Goodbye Spry Codgers, So Long Feisty Crones," reports that two groups, the International Longevity Center in New York City and the Aging Services of California, have put together a stylebook to guide media professionals through the minefield of politically correct and politically incorrect ways of identifying and portraying the elderly. Among the potentially unwelcome terms identified are “senior citizen," “golden years," “feisty,” “spry,” “feeble,” “eccentric,” “senile” and “grandmotherly.” Likewise, it can be viewed as patronizing to call someone “80 years young.” As for what's on our coffee mug? Don't even go there.
Is this another example of "political correctness" run amok, and can we just ignore it? Probably not. As previously reported here in the Stoel Rives World of Employment, ageist remarks like "grandma" can form the basis of an age discrimination lawsuit. Employers should be careful about how age-related terms are used in the workplace. It is unlikely that using a term like "senior citizen" by itself will lead to a lawsuit, but using it in the context of a performance review or a termination meeting might.
Last week, the United States Supreme Court agreed to review Gross v. FBL Financial Services, Inc., a case involving whether a plaintiff alleging a claim under the Age Discrimination in Employment Act must present "direct evidence" of discrimination to be entitled to a mixed-motive jury instruction.
A mixed-motive case in one where the evidence shows that an impermissible factor - such as age - was considered in making an employment decision even if the employer also based the decision on other permissible factors. In Gross, the plaintiff prevailed after a jury trial in which the jury was instructed that it was sufficient that the plaintiff proved age was a "motivating factor" in his employer's decision to terminate his employment. (A "motivating factor" is considered an eaiser burden of proof than "direct evidence"). The Eighth Circuit Court of Appeals reversed, holding that the "motivating factor" standard applies only to cases brought under Title VII of the Civil Rights Act of 1964 (i.e., sex, race, national origin and religious discrimination claims) and that Gross needed to prove his case with direct evidence to be entitled to a mixed-motive instruction.
Do employers need to be concerned about this case? Not really. This is one of those cases that means more for us lawyers than it does for our clients. If the Court rules for Gross, it will make certain types of age discrimination marginally easier for plaintiffs, but this will not change an employer's obligation to base employment decision only on permissible factors, such as performance, and not on impermissible factors, such as age.
Here's a shocker out of Illinois: a federal district court held that a retail chain's store manager calling a department head "Grandma" was evidence of age discrimination. In McDonald v. Best Buy Co., the plaintiff alleged she was demoted and forced out of her job because of her age in violation of the Age Discrimination in Employment Act (ADEA). The defendant argued she was demoted because of her inability to effectively manage her subordinates.
The case hinged to a large degree on the fact that the plaintiff's supervisor often referred to her as "Grandma," which the plaintiff argued was evidence of age discrimination. The defendant countered that because it is technically possible for a person under age 40 (and not protected by the ADEA) to be a grandmother, "Grandma" is not an age-related nickname. The court noted that while calling someone "Grandma" does not by itself violate the ADEA, it is certainly an age-related comment and does provide evidence of an ageist motive.
Here's the lesson for employers: be careful of "cute" nicknames that could be discriminatory. There are endless cases where nicknames like "Grandma," "Honey," "Baby" and the like supported claims of discrimination. Calling an employee "Grandma" might sound endearing at the time, but in the context of a lawsuit, it will likely sound discriminatory.
First, in Meacham v. Knolls Atomic Power Laboratory, the Court held 8-0 that an employer defending an Age Discrimination in Employment Act case bears the burden of proving a "reasonable factors other than age" or "RFOA" affirmative defense. Truth be told, most defense lawyers have assumed that it was the employer's burden to prove the affirmative defense; this decision simply confirms that assumption. Second, in Chamber of Commerce v. Brown, the Court ruled 7-2 that federal labor law preempts California Gov't Code Section 16645.2, which prohibits private employers who are "recipient[s] of a grant of state funds" from "us[ing] the funds to assist, promote, or deter union organizing." Again, not a big surprise.
Next, in Kentucky Retirement Systems v. EEOC, the Court held 5-4 that a disability-retirement-benefits plan for public employees did not violate the Age Discrimination in Employment Act (ADEA). The plan disqualifies employees who are still working from receiving benefits if they reach normal retirement age when they become disabled, and calculates disability retirement benefits so that older employees who is eligible for disability benefits receive fewer benefits than younger employees. The Court held that any differential treatment was not based on age, but rather on pension status.
Finally, in Metropolitan Life Insurance v. Glenn, the Court held 7-2 that an ERISA plan administrator's dual role of both evaluating and paying benefits claims creates a conflict of interest, and courts reviewing claims denials can properly consider that conflict in deciding to set aside the administrator's discretionary decision.