Transcript Chapter 12
Chapter 12
Age Discrimination
McGraw-Hill/Irwin
Copyright © 2012 by The McGraw-Hill Companies, Inc. All rights reserved.
Learning Objectives
Distinguish the perception of older workers from
the reality of their impact in the workplace
Describe the history of the protection of older
workers in the United States.
Distinguish the ADEA and state-based age
discrimination laws
Identify the legal options available to an
employee who believes that he or she is a victim
of age discrimination
12-2
Learning Objectives
Explain the prima facie case of discrimination
based on age
Describe the bona fide occupational qualification
defenses available to employers under the
ADEA
Distinguish circumstances where disparate
impact and disparate treatment apply in
connection with age discrimination
12-3
Learning Objectives
Analyze factual circumstances when employer
economic concerns may justify adverse action
against particular groups of workers
Recognize necessary elements to establish
pretext under the ADEA.
Define the parameters of a valid waiver of ADEA
rights
12-4
Oldie…But Goldie!
American culture values youth
Older workers perceived as and “issue to be
dealt with” and more expensive to retain
Younger workers perceived as better educated
and better qualified
Statistics do not match general perceptions
about older workers
12-5
Oldie…But Goldie!
Workforce that was 55 years and older
increased from 12 percent to 19 percent
between 1999-2009
Study by Pew Research
75 percent of workers today expect to continue to
work for pay after they retire
12-6
Oldie…But Goldie!
American Association of Retired People report
Additional cost for older workers are minimal
The act of generalizing constitutes wrongful
discrimination
12-7
Realities about Older Workers and Age
Discrimination
Employers should be aware of the impact of
terminations based on salary since older
workers may be higher paid than others on
average, due to job seniority
Age may not be used as a job qualification
12-8
Realities about Older Workers and Age
Discrimination
To file claims under the Age Discrimination in
Employment Act, claimants must be 40 or older
Employees are not required to retire at age 65 in
the United States
12-9
Myths about Older Workers
Older employees
Are not hard workers
Will get tired more easily than younger workers
Are less able to perform than younger workers
Don’t understand technology
12-10
Myths about Older Workers
Older employees (contd..)
Don’t want to travel too much and are generally more
stubborn and uninterested in learning
Make too much money since it’s often based on
seniority and not performance
Are just making time before they can retire
12-11
Regulation: Age Discrimination in
Employment Act
Prohibits discrimination in employment on the
basis of age
Applies to individuals who are at least 40 years
old
No upper age limit
12-12
Distinctions between ADEA and Title VII
The ADEA is more lenient than Title VII
regarding the latitude afforded employers’
reasons for adverse employment decisions
An employee is not barred from pursuing a claim
simply because the employer treated another
older worker better
The act only protects employees over 40 from
discrimination
12-13
Distinctions between ADEA and Title VII
Youth’s “reverse discrimination claim”
The EEOC modified its regulations to remove
language that prohibited discrimination against
younger workers
To ensure appropriate and adequate information
exists as to hiring practices in connection with
age, the ADEA has specific record-keeping
provisions for employers
12-14
State Law Claims
State laws on age discrimination varies widely
Some have no age discrimination laws
Other have laws that track the ADEA
A large number of states laws that provide greater
protections than those afforded by the ADEA
12-15
State Law Claims
Greater protection may include for following
State age discrimination laws apply to a wider range
of employers
State age discrimination laws sometimes allow a
wider range of damages
States often provide longer filing periods
No state is permitted to extend the protection to
someone younger than 40
12-16
Employee’s Options
An employee who believes that his or her
employer has engaged in age discrimination
must file a complaint using the employer’s
internal grievance procedures
12-17
Employee’s Options
Other options
File a complaint with the federal Equal Employment
Opportunity Commission
File a complaint with the state equivalent of the EEOC
(if one exists)
File a lawsuit in federal court under the ADEA
File a lawsuit in state court under state age
discrimination laws
12-18
Employee’s Prima Facie Case:
Disparate Treatment
Member of a protected class
40 years or older
Adverse employment action: Any action or
omission that takes away a benefit, opportunity,
or privilege of employment from an employee
Decision not to hire or terminate the employee
12-19
Employee’s Prima Facie Case:
Disparate Treatment
Qualified for the position: Able to meet the
employer’s legitimate job requirements
Meets legitimate job requirements
Dissimilar treatment
Treated differently from others not in the protected
class
12-20
Burden Shifting No More
Court decision on Gross v. FBL Financial Servs.
Inc.
No burden shifting occurs in ADEA cases
Mixed-motives age discrimination claims do not exist
under the ADEA for disparate treatment claims
Burden shifting still applies to Title VII cases
12-21
Employer’s Defenses
Bond Fide Occupational Qualification
EEOC guidelines for employers in an age
discrimination case brought under the ADEA
The age limit is reasonably necessary to the essence of the
employer’s business
All or substantially all of the individuals over that age are
unable to perform the job’s requirements adequately
Some of the individuals over the age possess a disqualifying
trait that cannot be ascertained except by reference to age
12-22
Employer’s Defenses
Mandatory retirement: Employee must retire
upon reaching a specified age
Deemed illegal by the 1986 amendments to the ADEA
Limited to two circumstances
Employer cannot base employment decisions on
age-related stereotypes
12-23
Proving a Case of Age Discrimination
Disparate Treatment
Step 1: Employee’s prima facie case
• The employee is in the protected class
• She or he was terminated or demoted
• Employee met employer’s legitimate expectations
• Others not in the protected class were treated more favorably
Step 2: Employer defenses
• BFOQ
Step 3: Employee may evidence pretext for employer actions
12-24
Proving a Case of Age Discrimination
Disparate Impact
Step 1: Employee’s prima facie case
• A facially neutral policy or rule is imposed by an employer
• Which has a different effect on an older group of workers
• No intent to discriminate is necessary
Step 1: Employer defenses
• Reasonable factor other than age (RFOA)
• Economic concerns
• Seniority
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Employee’s Prima Facie Case: Circumstances
Involving Claims of Disparate Impact
Reasonable factors other than age: May
include any requirement that does not have an
adverse impact on older workers, as well as
those factors that do adversely affect this
protected class but are shown to be job-related
There is no RFOA defense in Title VII
12-26
Employee’s Prima Facie Case: Circumstances
Involving Claims of Disparate Impact
Economic concerns
Nothing in the ADEA prohibits elimination of a
protected employee’s position for budgetary reasons
Reduction in force (RIF)
Employers may offer pay cut in lieu of termination (if
business necessity)
Correlation between compensation and age
Two views from the courts
12-27
Defenses Based on Benefit Plans and
Seniority Systems
The ADEA specifically excludes bona fide
retirement plans that distinguish based on age
Are not a “subterfuge”
Bona fide voluntary retirement plans must be
truly voluntary
Reasonable person must not feel compelled to retire
12-28
“Same Actor” Defense
Same “actor” both hires and fires a worker –
permissible inference that the employee’s age
was not a motivating factor in the decision
12-29
Retaliation
The ADEA prohibits retaliation
Punitive damages: Punitive damages are
designed to punish the party being sued rather
than compensate the injured party
Can be quite high, especially if the actions are
especially offensive, the defendant is a large
company, and the jury is angry
Are available for retaliation claims
12-30
Employee’s Response: Proof of Pretext
Where there is direct evidence of discrimination,
proof of pretext is not required
Showing pretext:
Offered reasons for the adverse employment action
have no basis in fact
Offered reasons did not actually motivate the adverse
employment action
Offered reasons are insufficient to motivate the
adverse action taken
12-31
Employee’s Prima Facie Case: Hostile
Environment Based on Age
The employer is 40 years or older
The employee was subjected to harassment,
either through words or actions, based on age
12-32
Employee’s Prima Facie Case: Hostile
Environment Based on Age
The harassment had the effect of unreasonably
interfering with the employee’s work
performance and creating an objectively
intimidating, hostile, or offensive work
environment
There exists some basis for liability on the part
of the employer
12-33
Waivers under the Older Workers’ Benefit
Protection Act of 1990
Waiver: The intentional relinquishment of a
known right
Concerns the legality and enforceability of early
retirement incentive programs and waivers of
rights under the ADEA
Every waiver must be knowing and voluntary
12-34
Waivers under the Older Workers’ Benefit
Protection Act of 1990
The waiver may not bar the employee from filing
a claim with the EEOC
If an employee signs a defective waiver, the
employee is not required to give back any
benefits received under the waiver
Provisions in connection with early retirement
plans
12-35
The Use of Statistical Evidence
Generally more useful in disparate impact cases
Skepticism relating to statistical evidence in age
discrimination cases due to attrition in the
workforce
Supreme court guidelines
Standard deviations and percentage comparisons
Surrounding facts and circumstances are important
12-36
Remedies
Money damages
Liquidated damages: Limit awards to a
predetermined amount
Equitable relief: Relief that is not in the form of
money damages, such as injunctions,
reinstatement, and promotion
Reinstatement, promotions, and injunctions
12-37
Employee Retirement Income Security
Act
Regulates private employee benefit plans
Protects employees from wrongful denial of all
types if benefits
12-38
Employee Retirement Income Security
Act
Regulates
Who must be covered
Vesting requirements
The amount that the employer must invest
Distinctions among benefit plans
Reduction in benefits across the board
Benefits based on seniority
12-39
Management Considerations
Employers should:
Evaluate the true requirements of a position
Test for those characteristics
Pay attention to the basis for decision making and
selection in connection with training and development
opportunities
12-40
Management Considerations
Problems with RIFs:
Employers generally do not retain intricate written
analyses of performance
Managers and supervisors will likely evaluate an
employee as compared to other employees
The employer may make a decision based on some
factor other than performance
Be sure all employees periodically receive an
objective, detailed performance appraisal
12-41
Management Tips
Any job requirement on the basis of age must be
subject to your highest scrutiny
Review all termination decisions carefully in order to
ensure fair and balanced procedures
Terminating an older worker and replacing her or
him with another worker who is over 40 does not
protect you from a charge of age discrimination
Review all recruiting literature to remove all agebased classifications
12-42
Management Tips
You may not terminate an older worker on the
basis of age
Employers should neither permit nor encourage
age-based remarks, comments, or jokes to avoid
liability under the ADEA for age-related
harassment
Employers should be sensitive about the
inclination in the past to single out workers over
40 for medical exams
12-43