Court Decision Limits Age Bias Claims Older Employees Can File

The 7th U.S. Circuit Court of Appeals has found that the Age Discrimination in Employment Act (ADEA) does not allow older job candidates who feel they faced aged bias to pursue disparate impact claims in court.

In March 2014, an attorney applied for a senior in-house position in CareFusion’s law department. The job description required applicants to have “three to seven years (no more than seven years) of relevant legal experience.” He was 58 at the time he applied and had more than seven years of pertinent experience. CareFusion passed him over and instead hired a 29-year-old applicant who met but did not exceed the prescribed experience requirement.

The attorney responded by filing a lawsuit and pursuing claims for both disparate treatment and disparate impact under Sections 4(a)(1) and 4(a)(2) of the ADEA. A Federal District Court granted CareFusion’s motion to dismiss the disparate impact claim, reasoning that the text of Section 4(a)(2) did not extend to outside job applicants.

The Appellate Court agreed with the District Court, noting that Section 4(a)(2) makes it unlawful for an employer to limit, segregate, or classify his employees in any way which would deprive or tend to deprive any individual of employment opportunities or otherwise adversely affect his status as an employee, because of such individual’s age.

The 7th Circuit found that the plain language of the Section proscribes certain conduct by employers and limits its protection to employees. “The prohibited conduct entails an employer acting in any way to limit, segregate, or classify its employees based on age. The language of Section 4(a)(2) then goes on to make clear that its proscriptions apply only if an employer’s actions have a particular impact—‘depriv[ing] or tend[ing] to deprive any individual of employment opportunities or otherwise adversely affect[ing] his status as an employee.’ This language plainly demonstrates that the requisite impact must befall an individual with ‘status as an employee.’ Put most simply, the reach of Section 4(a)(2) does not extend to applicants for employment,” the court’s opinion states.

The ruling is especially relevant as at least one study shows workers remain notably more likely to say they expect to retire at age 70 or older than at times in the past.

Commenting on the ruling, Andrew Challenger, vice president of global outplacement and executive coaching firm Challenger, Gray & Christmas, Inc., said it “further hurts older workers who may have experienced age discrimination in the workplace that resulted in a forced retirement or layoff. They now have to contend with a job market that further obstructs their job search efforts. Not only will this ruling potentially increase the discrimination older workers face, but it could leave companies open to brain drain, as the skills and accomplishments of older professionals contribute to growth and development. The channeling of older workers out of the labor market, especially skilled workers, damages the economic health of the country.”

Notably, according to the court document, the attorney voluntarily dismissed his separate claim for disparate treatment liability under ADEA Section 4(a)(1) which the court said makes it unlawful for an employer “to fail or refuse to hire or to discharge any individual or otherwise discriminate against any individual with respect to his compensation, terms, conditions, or privileges of employment, because of such individual’s age,” and, therefore, does apply to job applicants.