labor lawAdivision of labor law center

Employers implementing layoffs and staff reductions need to be especially cautious that they do not commit age discrimination.

 

According to a recent report, state and federal age discrimination claims were up 29% in 2008. This is almost double the increase in overall discrimination complaints, up 15%. And that number is not just complaints filed by workers – it is actual lawsuits filed by the EEOC or state agencies.

 

The federal ADEA or Age Discrimination in Employment Act, prohibits employers from discriminating against workers between the ages of 40 and 70 in any employment decision, including hiring, firing, promotions, salary, benefits, training, etc.

 

According to the EEOC, age should not be a factor in determining which employees are laid off. It is fairly common for an employer to thin, “Joe is eligible for retirement in a few years anyway, we’ll lay him off.” However, it is illegal discrimination based on age. Some employers take such actions because they think older employees will be impacted less by a layoff. Others do it to save potential pension and medical expenses. Either way, it is illegal.

 

According to a recent article in the AARP magazine, age discrimination claims may be even higher this year than in 2008, due to the many layoffs.

 

The AARP, of course, is the international association of people over the age of 50.

 

 “The wave is still building,” says Gerald L. Maatman, Jr. of Seyfarth Shaw,  a Chicago law firm that analyzes both state and federal discrimination suits against employers. It is expected to peak in the 3^rd quarter of 2009.

 

Employers should always base decisions on which employees to lay off on objective criteria that do not include age. Acceptable criteria include job performance, seniority, diverse skills or a combination of those factors. Employers should justify that decision in writing, and keep careful written records of the basis for the decision.

 

It is also illegal for an employer to discriminate against one older worker in favor of another older worker. A recent trend has been for employers to lay off workers in their 50s, in favor of workers in their 40s, based partly on age. Although both workers are covered by the ADEA, this is still age discrimination.

 

 

 

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1. Posted by: Terry

   Company A bought Company B about 3.5 yrs ago. Now they are closing Company B’s Sterling, Virginia plant. Two thirds of the employes are 50 or older is there any case for age discrimination?

2. Posted by: Amelia

   Hi Terry! No, there is probably no case for age discrimination here. It is not unusual for manufacturing plants to be shut down in the current economic climate — as you surely know. If the employer were firing all the workers over 40, and hiring younger people, that would be age discrimination. However, the employer is laying off everyone, regardless of age. By definition, a decision that affects workers of all ages the same is not age discrimination.
   If the employer said, “We have to close one plant. The one in Virginia has a lot of older workers, while the one in Indiana has a lot of younger workers. Let’s close the one in Virginia, to get rid of the older workers!” that would be age discrimination. But we seriously doubt that happened here, and you are going to have a really, really hard time proving it.
   You could certainly file an age discrimination complaint with the EEOC at http://www.eeoc.gov. They will investigate the complaint and if they find it has merit, they will file a suit on your behalf. Or, you could hire an attorney to file an age discrimination lawsuit. Our best guess is that you would pay the attorney a lot of money, and have little to show for it.
   Depending upon the number of people put out of work, you will probably be eligible for TAA. This is a federal program that extends unemployment and healthcare benefits, and most importantly, provides training for workers. You should take full advantage of all the training offered — many people over 50 successfully start their own businesses or embark on new careers after a layoff. HTH, and thanks for reading the blogs!~ Amelia

3. Posted by: Terry

   Thank you Amelia it was a long shot but I told the guys in the shop that I would try to find out what I could. The TAA program, how many people would it have to be?

4. Posted by: Amelia

   Hi Terry! Wish we could be more helpful! TAA ususally applies when the factory or jobs are being moved out of the country. Usually the state will automatically apply for TAA or extended unemployment benefits when more than 50 people are laid off, or a plant is closed. The U.S. Department of Labor runs other training programs through local community colleges. More into at the links below. HTH, and thanks for reading the blogs!~ Amelia

   Read more about TAA at: http://www.doleta.gov/tradeact/benefits.cfm and other programs at: http://www.doleta.gov/

5. Posted by: Eva

   Message
   Hello, Amelia,

   Quick one: Company A lays off a 62-year-old earning $60K per year while keeping on a 32-year-old earning $43K, who was last hired on staff. Can company justify the layoff on grounds the older employee earned more $ for doing basically the same job? Or is that a case of age discrimination?

6. Posted by: Amelia

   Hi Eva! This is not age discrimination, and many companies handle layoffs in exactly this way. When a company is faced with layoffs, the company must decide what criteria to use, in determining which employees to keep and which employees to lay off. The best practice is to use objective criteria like seniority, performance, skills, education, experience or salary, and to document those decisions in writing.
   In this situation, the company basically has two employees who handle the same job. One earns $60,000 per year while the other earns $43,000 per hear. The employer has decided to let the higher-paid employee go, and keep the lower-paid employee. This is a completely reasonable, valid and lawful business decision.
   Suppose both employees made $43,000 per year. The employer decided to let the older employee go, because they feared he would incur higher medical costs in the next decade. Or they let the 62-year-old employee go because they felt he was getting too old for the job. That would be discrimination based on age. HTH, and thanks for reading the blogs!~ Amelia