As the cost of living continues to increase, more Americans are working longer and retiring at older ages. Because Americans are working longer, age discrimination becomes a more prominent concern in the workplace. The South Carolina employment lawyers at Gignilliat, Savitz & Bettis are experienced in helping employers implement policies and practices that work to prevent discriminatory hiring, employment, and firing practices.
What is the Age Discrimination in Employment Act (ADEA)
In 1967, Congress implemented the ADEA to prohibit age discrimination in employment. Lawmakers determined that affluence and productivity of workers was on the rise and was causing an unfair disadvantage to older employees, particularly when older workers, determined to be workers over the age of 40, were trying to find new work. Congress intended the ADEA to accomplish three things:
- to promote employment of older workers;
- to prohibit arbitrary age discrimination in employment; and
- to help employers and workers solve problems that arise from the impact of age on employment.
What is Prohibited Under the ADEA?
The ADEA makes discriminatory employment practices unlawful, including:
- Failing, refusing to hire, or firing, or otherwise discriminating against a person because of age;
- Limiting, segregating, or classifying employees in a way that adversely affects their employment status because of their age;
- Reducing the wage of any employee because of age; or
- Determining job assignments, promotions, layoffs, trainings, fringe benefits or any other term of employment because of their age.
Interestingly, the ADEA does permit an employer to favor older workers based on age even if doing so adversely affects a younger worker who is 40 or older. The ADEA prohibits intentional discrimination, known as disparate treatment, as well as practices that appear neutral but have the effect of harming older workers more than younger workers, known as disparate impact.
What does the ADEA cover?
The ADEA’s protections begin before the employee-employer relationship is formed, and employers in South Carolina need to be cognizant of potential age discrimination when posting job notices. When advertising a job opening and recruiting new employees, age limitations, preferences, or specifications generally may not be included in these notices or advertisements, unless age is a bona fide occupational qualification, explained in more detail below.
Most employers in South Carolina know there are some questions they should not ask when interviewing job candidates to avoid the appearance of discriminatory hiring practices. While the ADEA does not specifically prevent an employer from asking a candidate’s date of birth or age, inquiries into an applicant’s age will be closely scrutinized should the applicant file a claim for discriminatory hiring practices based on age. Inquiries into an applicant’s age may also deter the applicant from pursuing the opportunity. If information about an applicant’s age is needed for lawful purposes, the age can be obtained after the employee is hired.
As aforementioned, employers cannot treat employees in a discriminatory fashion based on the employee’s age if the employee is over 40 years old. This protection extends to employment benefits as well. Current law allows cost-based differences in benefits in limited circumstances. Further, while employers generally may coordinate any retiree health plans they offer with Medicare, they may not offer incentives for active older workers to take Medicare instead of the employer’s health plan. In general, employers must offer older workers the same health plan they offer younger workers.
The ADEA prohibits terminations based on age. In most cases, forced retirement due to age is also prohibited. It can be commonplace for employers to ask employees to waive ADEA rights or claims at separation from employment in exchange for money or some other benefit. The ADEA sets forth specific requirements for this to occur. To waive claims under the ADEA, the waiver must:
- Specifically refer to ADEA claims or rights;
- Not waive future rights or claims;
- Be in exchange for consideration beyond what the employee is currently entitled to;
- Advise the employee to consult an employment lawyer prior to signing;
- Provide the employee at least 21 days to consider the agreement and 7 days to revoke the agreement after signing; and
- Be in writing and set out in a manner calculated to be understood by the individual signing it.
If the waiver is sought in connection with an exit incentive, the 21-day period becomes 45 days. In addition, information about the position titles and ages of employees who are eligible and ineligible for the incentive must be provided.
Who Must Follow the ADEA?
The ADEA protects employees as well as job applicants. Organizations or companies that must comply with the ADEA are those with 20 or more employees, including state local governments, labor organizations, and employment agencies. Apprenticeship programs, including joint labor-management programs, must not discriminate based on an individual’s age.
Recent Changes to the ADEA’s Application
In November 2018, the United States Supreme Court issued a unanimous ruling that has been interpreted at a blow to small public-sector employers currently battling age discrimination lawsuits. The court ruled that the ADEA applies to all state and political subdivisions regardless of the number of employees the entity has, as opposed to applying to state and political subdivisions employing more than 20 people. This ruling will affect many local governments and special districts created by local governments or the state, like fire districts, and will add to compliance requirements.
Defenses to an ADEA claim
If a person has made a claim against an employer for a disparate impact violation of the ADEA (policies that appear neutral but have the effect of harming older workers more than younger workers), the employer could be absolved of liability if the employer can show the practice is based on a reasonable factor other than age (RFOA).
If a person has made a claim against an employer for discriminatory hiring practices, the employer may be absolved of liability if it can show that age is a bona fide occupational qualification (BFOQ) which is reasonably necessary to the normal operation of the business. BFOQs should relate to an essential job duty. The employer must prove the requirement is necessary to the business and that a definable class or group of employees would not be able to perform the job safely or efficiently. The inquiry for a BFOQ focuses on the necessity of using an expressly forbidden classification. An example of an age-related BFOQ would be the mandatory retirement age for commercial airline pilots, which is imposed by federal regulations for safety reasons.
Consult an Experienced Employment Lawyer in SC
As experienced employment lawyers in South Carolina, we know how financially challenging it can be for an employer to defend any kind of employment claim. Employers, including those which are small government entities, should review their job posting, hiring, employment, and termination practices to ensure compliance with ADEA is maintained. Contact one of our dedicated employment lawyers at Gignilliat, Savitz & Bettis to review your workplace policies and practices for compliance with the ADEA.