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U.S. Supreme Court Intensifies Burden on Employers Defending Age Discrimination Lawsuits

Today the U.S. Supreme Court made it more difficult for employers to defend lawsuits based on the Age Discrimination Employment Act (ADEA). In Meacham v. Knolls Atomic Power Laboratory, the Supreme Court ruled that the burden of proving that any termination having a disparate impact on older workers was based on reasonable factors, falls on employers.

From page one of the opinion:

US%20Supreme%20Court.jpgWhen the National Government ordered its contractor, respondent Knolls, to reduce its work force, Knolls had its managers score their subordinates on “performance,” “flexibility,” and “critical skills”; these scores, along with points for years of service, were used to determine who was laid off. Of the 31 employees let go, 30 were at least 40 years old. Petitioners (Meacham, for short) were among those laid off, and they filed this suit asserting, inter alia, a disparate-impact claim under the Age Discrimination in Employment Act of 1967 (ADEA), 29 U. S. C. §621 et seq. To show such an impact, Meacham relied on a statistical expert’s testimony that results so skewed according to age could rarely occur by chance; and that the scores for “flexibility” and “criticality,” over which managers had the most discretionary judgment, had the firmest statistical ties to the outcomes. The jury found for Meacham on the disparate-impact claim, and the Second Circuit initially affirmed. This Court vacated the judgment and remanded in light of its intervening decision in Smith v. City of Jackson, 544 U. S. 228. The Second Circuit then held for Knolls, finding its prior ruling untenable because it had applied a “business necessity” standard rather than a “reasonableness” test in assessing the employer’s reliance on factors other than age in the layoff decisions, and because Meacham had not carried the burden of persuasion as to the reasonableness of Knolls’s non-age factors.

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