United States Supreme Court Makes it Easier to Prove Age Discrimination

Supreme Court Rules Employer Has Burden to Prove Adverse Employment Action Based on Reasonable Factors Other Than Age

The Age Discrimination in Employment Act of 1967, 29 U.S.C. 621, et seq. (“ADEA”), is a federal law that prohibits discrimination in employment because of age. On June 19, 2008, the United States Supreme Court made it easier for employees to prevail in disparate impact claims under the ADEA, by placing an important burden of proof on the employer. A disparate impact case under the ADEA is when an individual seeks to prove that his or her employer illegally discriminated against him or her because of age, even though it did not necessarily intend to discriminate, because it used a specific test, requirement, or practice that disproportionately harmed employees who are at least 40 years old.

In that case, Meacham v. Knolls Atomic Power Laboratory, the Supreme Court interpreted a provision of the ADEA that permits an employer to take an adverse employment action against an employee, even if the employment action is “otherwise prohibited” by the ADEA, as long as the adverse action is “based on reasonable factors other than age.” The Supreme Court ruled that if an employer seeks to rely on that defense, it has the burden to prove that its decision was based on a reasonable factor other than age.

In Meacham, Knolls Atomic Power Laboratory was planning to lay off a number of employees. The company had its supervisors rate their subordinates based on their “performance,” “flexibility,” and “critical skills.” Knolls totaled those scores, and gave the employees additional points based on their years of service. It then used those totals to decide who to lay off. Thirty of the 31 salaried employees the company laid off were at least 40 years old. Twenty-eight of those 31 employees sued under the ADEA, claiming Knolls illegally fired them because of their age.

At the trial, a jury found Knolls had violated the ADEA because its layoff procedure had a disparate impact based on age.

Specifically, the jury found that although the plaintiffs did not prove that Knolls intentionally discriminated against them, they did prove that Knolls’ method of deciding who to lay off disproportionately harmed older workers. The United States Court of Appeals for the Second Circuit initially affirmed the jury’s findings, but after the United States Supreme Court asked it to reconsider, the Second Circuit reversed itself and ruled in favor of Knolls. The Supreme Court then agreed to hear the case, and eventually reversed the Second Circuit and reinstated the jury’s finding that Knolls’ policy unlawfully discriminated because of age.

In reaching its conclusion that the employer has the burden to prove the “reasonable factors other than age” defense, the Supreme Court looked at another provision of the ADEA, the bona fide occupational qualification (“BFOQ”) defense. The BFOQ defense states that it is not unlawful for an employer to take adverse employment actions otherwise prohibited by the ADEA “where age is a bona fide occupational qualification reasonably necessary to the normal operation of the particular business.” In other words, the ADEA permits employers to discriminate based on age considering age is legitimately necessary under the circumstances. For example, it would not be illegal to consider criteria for a particular role in a movie that has a disparate impact on age, if the part calls for someone of a particular age. The Supreme Court has previously recognized that the employer has the burden to establish the BFOQ affirmative defense.

The Supreme Court also relied on previous decisions in which it recognized that the employer has the burden of proof to establish similar defenses under other federal anti-discrimination laws. Specifically, it has previously ruled that the employer has the burden of proof with respect to the defense that a pay differential is based on “any other factor other than sex” under the Equal Pay Act of 1963 (“EPA”), and that the employer has the burden of proof to establish an exemption under the Fair Labor Standards Act of 1938 (“FLSA”). The Supreme Court found that the reasonable factor other than age defense was similar to those provisions, and that therefore the burden of proof should be on the employer.

Thus, the Supreme Court made it clear that once an employee establishes that a specific test, requirement, or practice of his or her employer disproportionately harms older workers, the employee will win his or her case unless the employer can prove that age is a bona fide occupational qualification reasonably necessary to the normal operation of the particular business, or can show that its decision was based on a reasonable factor other than age. As the Supreme Court recognized, that not only makes it easier for employees to win disparate impact cases under the ADEA, but it is also likely to impact the way some employers make layoff decisions. It is therefore likely to further support the primary goal of the ADEA: eliminating age discrimination from the workplace.