Yesterday on June 18, the United States Supreme Court issued its decision in Gross v. FBL Financial Services, Inc., making it easier for employers to defend claims of age discrimination in court. The Court ruled that the proper standard by which to evaluate a discrimination claim under the Age Discrimination in Employment Act (ADEA) is whether "but for" the employee's age, the employer would have acted differently towards the employee. The Court also ruled that the burden to prove this "but for" level of discriminatory conduct always remains with the employee, and does not shift to the employer at any point in the lawsuit.
This ruling marks a significant development in the law pertaining to claims of age discrimination. Previously, the Supreme Court had stated in a 1989 case (Price Waterhouse) that the proper test to assess potential employment discrimination under Title VII of the 1964 Civil Rights Act was whether the employer had "mixed motives" for taking the action it did, and if so, whether discriminatory intent was a "substantial" or a "motivating" factor in the employer's actions. That is, whether an improper discriminatory criterion played a part or a role in an adverse employment decision.
It had been assumed by several courts since that time, as well as by the trial judge in this case, that this 1989 standard applied to age discrimination claims. In this case, Jack Gross had worked for FBL Financial for over 30 years. He claimed he was demoted in 2003 (at the age of 54) from claims administration director to claims project coordinator and that his duties were assigned to someone whom he had previously supervised, who was in her early 40s. Therefore, he filed suit alleging that the company unlawfully discriminated against him on account of his age. As the result of the 1989 case, the trial judge in this case indicated that the company was saddled with the burden to demonstrate that it would have made the same decision even if it had not taken Mr. Gross' age into account, that is, that age was not a "motivating factor" in its decision to change Mr. Gross' job duties and responsibilities.
The Supreme Court specifically declined to extend the 1989 Title VII standard to claims under the ADEA. Instead, the Court determined that Title VII was "materially different with respect to the burden of persuasion" from the ADEA and that the "motivating factor" standard of Title VII does not apply in ADEA cases. The Supreme Court also rejected the principle that the employer in this case should have the burden to prove that age was not a "motivating factor" in its challenged decision, stating that the burden of proof "does not shift" from the employee to the employer in an ADEA case.
Carefully reviewing the wording of the ADEA, and noting its differences in nomenclature from Title VII, the Supreme Court ruled that the statutory language about age discrimination occurring when an employer acts "because of" the age of the employee meant that the employee's age must be the "reason" that the employer decided to act. Hence, the Court stated that the burden of proof in ADEA cases is that "but for" age, the employer would have taken no adverse employment action towards the employee.
As a result of this decision, it is expected that older employees will have a more difficult time demonstrating that age discrimination has occurred, principally because employers will not be faced with the burden of having to explain or prove a "negative" (i.e., that the employment action in question was not the result of age discrimination). As a result of this recent decision, employers facing potential age discrimination issues or claims should consult with their employment law attorneys regarding how the new "but for" test might affect the outcome.
Lionel Schooler is a partner in Jackson Walker's Houston office, specializing in labor and employment law and federal court litigation. He can be contacted at 713.752.4516 or by e-mail at lschooler@jw.com.
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