The United States Supreme Court (the "Court") issued an opinion on March 30, 2005, that the Federal Age Discrimination in Employment Act ("ADEA") may provide employees an avenue of relief for age discrimination claims based on an employer’s facially neutral policy or practice which unintentionally discriminates against age-protected employees. In Smith v. City of Jackson, the Court held that a facially neutral wage policy which had a disparate impact on older workers was a valid claim protected under the ADEA. Disparate impact claims are intended to address employer policies or practices that are neutral in their treatment of different groups of employees but result in a discriminatory impact on a protected class. Until the Court’s decision in Smith, courts routinely rejected disparate impact claims under the ADEA.
Although the Court’s decision in Smith may result in more age discrimination lawsuits filed against employers, the Court in Smith also provided important guidance to employers avoiding liability by providing evidence that the challenged policy or practice was based upon reasonable criteria other than age. In other words, an employer can provide evidence of reasonable, nondiscriminatory reasons for its policy or practice as a defense to a claim that the policy or practice has a disparate impact on age-protected employees. The Smith case is an important reminder for employers to carefully review and document, if necessary, its lawful and legitimate reasons or criteria for implementing policies and procedures which may unintentionally have an adverse impact on age-protected employees. For example, an employer undergoing a workplace reorganization or reduction in force may be using legitimate and lawful criteria, such as job performance, for selecting affected employees but the end result may unintentionally have an adverse impact on age-protected employees. Employers may also want to consult with legal counsel prior to documenting or implementing policies and procedures which may adversely impact protected groups.
Winthrop & Weinstine, P.A., employment attorneys are available to assist you with your employment-related legal issues. If you would like to set up a meeting to discuss your specific needs and questions, please contact Laura Pfeiffer at 612.604.6685, lpfeiffer@winthrop.com; Mark Pihart at 612.604.6623, mpihart@winthrop.com; or Tony Moch at 612.604.6671, amoch@winthrop.com.
The information contained in this e-mail is intended to provide you with up-to-date information on a recent Supreme Court ruling. It is a general summary and is not intended to be a substitute for legal advice. Recipients should always consult their attorney about specific legal matters.