In a decision hailed by employee advocates as a triumph, the U.S. Supreme Court ruled yesterday that in age discrimination cases the employer bears the burden of proof that employment decisions having a “disparate impact” on older workers are based on a reasonable factor other than age.
Three years ago, in March 2005, the Supreme Court ruled in the landmark case of Smith v. City of Jackson that the Age Discrimination in Employment Act (“the ADEA”) protects workers when an employer implements a policy which, on its face, has nothing to do with age, but in practice disproportionately impacts employees over age 40 in a negative way. (Notably, this marked a significant change for Florida employers because until that ruling, federal courts in Florida had held that the “disparate impact” theory was not applicable to age discrimination cases. To win a case, an ADEA plaintiff had to prove the employer’s alleged discriminatory policy was intended to harm older workers.) In Smith the Supreme Court held that such claims were in fact actionable under the ADEA, but did give the employer a “safe harbor” for their policies. Once an employee was able to show that the policy did in fact have a disparate impact, the employer could avoid liability by bringing forward evidence that the policy was based on “reasonable factors other than age,” a standard referred to by the Court as “RFOA.”
By requiring only an RFOA in the Smith case, the Court gave employers an advantage they did not have in disparate impact cases that traditionally arose in the contest of sex discrimination claims under Title VII of the Civil Rights Act. It has long been held that to avoid liability for a policy that has a disparate impact against a protected class under Title VII, the employer must show that the job requirement is a “bona fide occupational qualification,” referred to as a “BFOQ.” The classic examples in those early cases were height and weight restrictions which disproportionately excluded women from jobs as firefighters, but were held to be BFOQ’s because a certain minimum height and weight was deemed necessary to the ability to carry an overweight, unconscious victim out of a burning building. By interpreting the ADEA as requiring a lesser standard – the reasonableness standard of the RFOA instead of the absolute job necessity standard of the BFOQ – the Court made it much easier for an employer who was not intentionally discriminating to defend policies that had a disparate impact on older workers, so long as those policies were otherwise reasonable.
The question that remained after the Smith decision, however, was what happened procedurally after the employer brought forward evidence of the RFOA? To prove discrimination, did the employee have to prove that the employer’s asserted justification for the policy was in fact unreasonable? Or did the employer have the burden of proving that it was reasonable? While this distinction may appear at first blush to be a minor question of semantics, the question of who has the burden of proof can drastically change the outcome of a trial.
Until yesterday, federal courts were split on this issue. The Supreme Court has now resolved the question in Meacham v. Knolls Atomic Power Laboratory, holding that the employer must not only bring forward evidence that its policy was based on an RFOA, but also prove that the factor relied on is a reasonable one.
What this case means as a practical matter for employers is that care should be taken to examine any policies that appear to disproportionately impact older workers, and be prepared not merely to articulate a reasonable, nondiscriminatory basis for that policy but also to prove that the policy is reasonable.