Age Discrimination in Employment Act (ADEA)
The Age Discrimination in Employment Act (“ADEA”) prohibits age discrimination in the workplace against applicants or employees age forty (40) and over due to their age. The ADEA was enacted “to promote the employment of older persons based on their ability rather than age; to prohibit arbitrary age discrimination in employment; to help employers and workers find ways of meeting problems arising from the impact of age on employment.” Title II of The Older Workers Benefit Protection Act (“OWBPA”), which amends the ADEA, regulates waivers of age discrimination claims sought by employers in connection with severance or early retirement packages to individuals age 40 and over. See EEOC-Fact-Sheet-Age-Discrimination-ADEA
AGE DISCRIMINATION IN EMPLOYMENT ACT
Employers Covered by the Age Discrimination in Employment Act
The ADEA applies to private employers, the federal government, state and local governments, labor organizations, and employment agencies. The ADEA covers private employers who employ 20 or more employees in each of 20 or more calendar weeks in the current or preceding calendar year. Even employers with fewer than 20 employees may be covered, if the employer acted jointly with a parent, subsidiary or affiliated corporation, and the total number of employees at both companies is 20 or more, and the two companies have acted as a joint enterprise.
The ADEA also prohibits labor unions from engaging in age discrimination.
If an employment agency regularly procures employees for at least one employer covered by the ADEA, it is also covered by the ADEA.
Employees Covered by the Age Discrimination in Employment Act
The ADEA prohibits age discrimination in the workplace against “employees” who are age 40 and over. Independent contractors are not “employees” under the ADEA and, therefore, are not covered by the Act. The fact that an employee is called an independent contractor, however, does not automatically mean that he or she is actually an independent contractor. Instead, the courts analyze whether the worker is in business for himself or herself and whether the employer has the right to control the means and manner of the worker’s performance. Thus, even a worker who has been labeled an “independent contractor” may still be covered by the Act.
Prohibited Practices under the Age Discrimination in Employment Act
The ADEA prohibits age discrimination in the workplace against employees with respect to their compensation, terms, privileges, or conditions of employment because of their age. The most common ADEA claims involve discriminatory hiring, firing, lay-offs, demotions or promotions. The ADEA protects older workers against harassment in the workplace on the basis of age.
The ADEA also prohibits a covered employer from retaliating against any employee who opposes a prohibited practice, files a charge, or participates or testifies in an investigation, proceeding, or litigation under the ADEA. This protection even applies to employees who are under age 40.
The ADEA prohibits the printing or publishing of any notice or advertisement indicating any preference, limitation, specification, or discrimination against older workers. In addition, employment agencies may not refuse to refer an applicant for employment because he or she is age 40 or over. Nor can an employment agency classify any person on the basis of age. The ADEA does not protect relatively young workers, who are 40 or under, from age discrimination in the workplace based on an employer’s preference for older workers.
Specific Defenses to Claims under the Age Discrimination in Employment Act
An employer may overtly base employment decisions on age if it can show that age is a bona fide occupational qualification (“BFOQ”) that is reasonably necessary to the normal operation of the particular business. This defense may be asserted in only very limited circumstances. In determining whether a BFOQ is valid, courts typically analyze whether the policy is reasonably necessary to the essence of the employer’s business.
If a bona fide seniority system would otherwise violate the ADEA, it is valid as long as it was not intended to evade the purposes of the ADEA. Since seniority systems tend to favor rather than disfavor older workers, employers rarely need to raise this defense. However, a seniority system cannot require or permit involuntary retirement of any employee on the basis of age.
An employer may offer different terms for an older employee benefit plan where the payments made or costs incurred on behalf of an older worker are at least as large as those incurred on behalf of a younger worker.
Claims under the Age Discrimination in Employment Act
In order to pursue an age discrimination claim, an applicant or employee must first file a charge of discrimination with the Equal Employment Opportunity Commission. It must typically be filed within a very short time frame (180 or 300 days) from the date of the alleged discrimination or retaliation.
The EEOC (or state fair employment practices agency – which is the Colorado Civil Rights Division in Colorado) will investigate the charge of discrimination or retaliation. If the agency determines there is “probable cause” to believe that discrimination occurred, it will attempt to conciliate (or resolve) the claim. If conciliation fails, the EEOC may litigate the claim in limited circumstances. Otherwise, the employee may obtain the right to pursue claims in court.
Remedies available under the Age Discrimination in Employment Act
If an applicant or employee prevails on an age discrimination claim, he or she may be entitled to the following relief:
- Reinstatement, compelled employment, or compelled promotion;
- Back pay;
- Front pay;
- Liquidated damages (not available for federal employees); and
- Attorneys’ fees
OLDER WORKERS BENEFIT PROTECTION ACT (OWBPA)
If an employer offers employees age 40 and over an early retirement incentive plan or a severance package, such a plan is governed by the OWBPA. The OWBPA requires that waivers of age discrimination claims be voluntary – meaning that (1) the employee had sufficient time to consider his or her options, (2) the employer provided the employee with certain information regarding the benefits available under the plan or package, and (3) the employer did not threaten or intimidate the employee into accepting the package.
Under the OWBPA, any waiver of ADEA claims will be enforceable only if it is found to be knowing and voluntary. To meet this standard, the following eight conditions must be met or the waiver will be found to be invalid:
1. The waiver must be clear and unambiguous.
2. The waiver must specifically refer to rights or claims arising under the ADEA.
3. The waiver may not encompass claims arising after the date the waiver is executed.
4. The waiver must be signed in exchange for benefits that the employee is not already entitled to by right. In other words, the employee must receive something that he or she is not already entitled to receive as a matter of right.
5. The employee must be advised in writing to consult with a lawyer before signing the waiver.
6. The employer must provide the employee with at least 21 days to consider the matter before signing the agreement. The required period may go up to 45 days if the waiver is requested of a group of employees as part of an early retirement incentive program or other employment termination program.
7. The employee must be given seven days after signing the agreement in which to revoke the waiver. The agreement is not valid until the end of the seven days.
8. If the waiver is requested in connection with an incentive or other employee retirement termination program offered to a group of employees, the employer must inform employees in writing about the class, unit, or group covered by the program, any eligibility factors for the program, and any applicable time limits. The employer must also make clear to employees the job title and ages of all individuals eligible for the program, and the ages of all individuals in the same job classification, or organizational unit who are not eligible or selected for the program.
If an employee signs a waiver that fails to comply with all eight (8) of these requirements, then the waiver does not bar an ADEA claim
If you have any questions about the Age Discrimination in Employment Act, or Older Workers Benefit Protection Act, please contact the experienced labor and employment attorneys at Baird Quinn LLC. You may go to the following link for contact information and additional information about our ADEA employment lawyers.