Could Your Company Defend Itself in an Age Discrimination Lawsuit?
Posted on Tuesday, March 12, 2019 Share
Chances are good that some of your company's workforce is aging, which is in line with the demographics of the United States. But in general, you cannot treat those employees any differently from the way you treat your younger workers. Otherwise, you may wind up in court.
Individuals over the age of 40 fall into a protected class created by the federal Age Discrimination Employment Act (ADEA). If your business has more than 20 employees, the ADEA provides protection from employment discrimination based on age. It also applies to state and local governments, employment agencies and labor organizations. The ADEA specifically covers hiring, firing, promotion, layoff, compensation, benefits, job assignments and training.
Job Notices and Advertisements
The ADEA generally makes it unlawful to include age preferences, limitations or specifications in job notices or advertisements.
A job notice or advertisement may specify an age limit only in the rare circumstances where age is shown to be a "bona fide occupational qualification" reasonably necessary to the normal operation of the business.
How well you can defend your company in an age discrimination suit largely depends on your company's actions, policies and general employment practices. For example, if you or your managers are lax, employees may have readily available evidence to prove they were unfairly treated or let go because they were a certain age and too expensive.
Clearly, it is not a good idea to use those phrases when letting a protected employee go. Even worse would be communications, written or verbal, instructing managers to get rid of "old" employees.
But even if the evidence isn't that readily available or obvious, a skilled statistician might dig up data painting a picture that strongly supports a discrimination charge.
A large number of companies don't maintain a continuing analysis of their hiring, firing and promotions practices when it comes to employees in the protected age group.
It is crucial that your company understand its own data. When faced with a legal action, you must be able to respond before an expert witness statistician uncovers data that appears to support a claim that your company is discriminating against older staff members.
Without being able to defend your policies, you could wind up on the receiving end of some major financial costs. Employees who are successful in their age discrimination suits can recover past and future lost earnings and benefits, compensation for emotional distress, attorney fees and punitive damages.
The ADEA, in fact, includes a section that specifies the types of damages allowed in age discrimination suits, including:
Back pay, which is the most common award and includes the value of wages, salary and fringe benefits an employee would have received from the date of the discriminatory act to the date the court hands down a judgment. If the discrimination was willful, the court may double the damages. However, employees may have to show that they tried to mitigate their losses by attempting to find alternative employment.
Injunctive relief, which can include reinstating a terminated employee and ordering the employer to prevent future discrimination. If no position is immediately available, or if there is substantial animosity between the parties, the court can award front pay.
Front pay compensates the employee for anticipated future losses. The award can be for a specific length of time or until the age when the employee would have retired. The court cannot double these damages.
Liquidated damages are additional to and equal to back pay. They are awarded only if the discrimination was willful.
From a financial perspective, it's clearly worth your while to help ensure that your company's policies do not foster age discrimination, either directly or indirectly.
Twelve key points to include in your approach to older employees:
1. Avoid basing hiring, firing, promotions or bonuses on age-based assumptions such as older employees are inflexible, unable to learn new procedures and likely to retire soon.
2. Make employment decisions regarding older workers based on their individual skills, abilities and merit.
3. Don't make salary assumptions based on age.
4. Use a mixed-age interview panel whenever possible.
5. Apply the same evaluation criteria for all job applicants, regardless of age.
6. Be sure that everyone who interviews candidates is familiar with age discrimination laws.
7. Avoid asking older employees information such as when they plan to retire.
8. Avoid encouraging older employees to take retirement.
9. Don't eliminate one job to lay off an older worker and then create a new job with the same duties and hire someone younger.
10. Avoid making such age-related comments as older employees move too slowly, can't keep up with the younger employees or lack enthusiasm.
11. Place job advertisements where they will reach workers of all ages.
Posted in Tax Topics For Individuals, Tax And Accounting Topics For Business
Disclaimer: The information contained in Dulin, Ward & DeWald’s blog is provided for general educational purposes only and should not be construed as financial or legal advice on any subject matter. Before taking any action based on this information, we strongly encourage you to consult competent legal, accounting or other professional advice about your specific situation. Questions on blog posts may be submitted to your DWD representative.