Employee Subgroups Expand Employers’ Age Discrimination Liability

The ADEA & Disparate Impact

The Age Discrimination in Employment Act (ADEA) prohibits employment discrimination against persons over the age of forty. One way an employee can demonstrate age discrimination is by showing that a specific employer policy or practice has a “disparate impact” on members of the protected class. For example, a particular hiring practice that disproportionately impacts applicants over forty can be the basis for an age discrimination case.

Usually, disparate-impact claims are proven with statistical evidence showing the impact of the specific employment decision or policy on employees over forty compared to workers under forty. It also happens that a specific employment policy may adversely impact a “subgroup” of protected workers as compared to younger workers who are within the protected class. For example, an employer’s reduction-in-force decisions may adversely impact a subgroup of workers fifty-and-over as compared to workers between forty and fifty.

Age is the Protected Trait

Courts are divided on the question of whether an ADEA disparate-impact case can be made on such “subgroups.” Last month, the 3rd Circuit ruled that plaintiffs can demonstrate a disparate impact by comparing subgroups of older employees within the protected class (such as those over 50 years old) with younger employees both outside of the protected class and younger employees within the protected class (such as those between 40 and 50 years old). Karlo v. Pittsburgh Glass Works, No. 15-3435 (3d Cir. Jan. 10, 2017). In contrast, the 2nd Circuit, 6th Circuit and 8th Circuit Courts have rejected subgroup disparate-impact claims.

What’s in a Number?

Although the Supreme Court has yet to weigh in on the issue age discrimination among subgroups in ADEA disparate-impact cases, the Court has clarified that the ADEA proscribes age discrimination, not “forty or over” discrimination. O’Connor v. Consolidated Coin Caterers Corp., 517 U.S. 308 (1996). Using that reasoning, the Court has held that an employee can make an age discrimination claim on the basis that the employment decision in question favored a younger employee, even if the younger worker is within the protected over-forty class.

ADEA Takeaways

When implementing a new policy or practice, employers should carefully analyze the probable impact that the policy or practice will have on the protected class of workers, as well as possible subgroups within the protected class.  Although disparate-impact claims are defensible by showing that the employment decision is attributable to a “reasonable factor other than age,” employers are advised to take a conservative approach in making and monitoring the ongoing impact of employment decisions.

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