New case: ADEA applicants

In Rabin v. PriceWaterhouseCoopers LLP, a federal judge in the Northern District of California has allowed an applicant for employment to proceed on a disparate impact claim under the ADEA.  This holding is at odds with Villarreal, which held that the ADEA did not allow applicants to pursue an ADEA disparate impact claim.  The cert petition was just filed in Villarreal, so stayed tuned!

Villarreal questions presented

I thought readers might be interested in the three questions presented in the Villarreal cert petition.

  1.  Whether §4(a)(2) of the Age Discrimination in Employment Act (“ADEA”), 29 U.S.C. §623(a)(2), permits challenges to hiring criteria that disproportionately disadvantage prospective employees in the protected age group, or whether §4(a)(2) permits claims only by an employer’s existing employees.
  1. Whether courts should defer, under Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837 (1984), or Auer v. Robbins, 519 U.S. 452 (1997), to the United States Equal Employment Opportunity Commission’s regulation interpreting §4(a)(2) as permitting challenges to “[a]ny employment practice that adversely affects individuals within the protected age group on the basis of older age,” including challenges brought by prospective employees.
  1. Whether, as a matter of law, an employment discrimination plaintiff alleging that his EEOC charge-filing deadline was equitably tolled must plead that he pursued an investigation into the status of his job application, as the Eleventh Circuit held, even where the complaint plausibly alleges that a reasonable individual in the plaintiff’s position would not have pursued such an investigation and that such an investigation would not have put the plaintiff on notice of a potential claim or generated additional relevant information regarding the potential claim.

Big news out of the Third Circuit

There is a big decision out of the Third Circuit that creates a circuit split with three other circuits. On January 10, 2017, the Third Circuit issued an opinion in Karlo v. Pittsburg Glass Works, LLC, No. 15-3435. The Third Circuit held that subgroup claims are allowed in ADEA disparate impact cases, creating a circuit split on the issue.   A subgroup claim is when a group of workers tries to establish disparate impact by proving that a subset of older workers were disparately impacted by a decision. For example, in a reduction in force, the employees might argue that workers 50 and older were impacted by the reduction in force compared to workers younger than 50. If you want to read more about this issue read my article (cited by the 3d Circuit), Sandra F. Sperino, The Sky Remains Intact: Why Allowing Subgroup Evidence is Consistent with the Age Discrimination in Employment Act, 90 Marq. L. Rev. 227 (2006).

The Third Circuit takes a textual approach to the ADEA, arguing that the statutory language does not require all individuals 40 and older to be treated in the same negative way. Rather, the statute prohibits discrimination on the basis of age, not class membership (citing O’Connor v. Consolidated Coin Caterers, Corp.). As the Third Circuit noted, the ADEA prohibits age discrimination “as opposed to 40 or over discrimination.” The Court held that interpretation of the text of the ADEA relevant to disparate treatment claims should be applied to the same language used for disparate impact claims.

The Third Circuit buttressed its argument by citing Connecticut v. Teal. It noted that allowing subgroup claims was consistent with the Supreme Court’s decision that the bottom-line defense is not proper. As the Third Circuit noted, “The ADEA does not permit the victim of a facially discriminatory policy to be told that he has not been wronged because other persons aged forty or older were preferred.” The Court further reasoned that “[m]andating a forty-and-older comparison group would allow an employer to adopt facially neutral policies which had a profoundly disparate impact on individuals over age 50 or 55, so long as younger individuals within the protected class received sufficiently favorable treatment.”

What to do about McDonnell Douglas?

There is much to like in Ortiz; however, there is one part of the opinion that is problematic.  While the Seventh Circuit decries dividing evidence into buckets labeled direct evidence and indirect evidence and then analyzing that evidence separately, it is left with a bit of a problem with what to do with McDonnell Douglas. Ortiz already presses discrimination jurisprudence forward quite significantly and it is probably too much to ask to demand that the court also take on the behemoth that is McDonnell Douglas.

Rather than take it on, the Seventh Circuit simply notes that McDonnell Douglas is consistent with Ortiz. In principle, the Seventh Circuit is correct.  McDonnell Douglas and its progeny set forth one way for courts to look at certain discrimination cases.  That framework is not the only way to look at these cases.  However, the Seventh Circuit missed an important opportunity to address a difference between principle and practice.  Many judges treat McDonnell Douglas as if it is the only way to establish a disparate treatment claim based on circumstantial evidence.  The test has created the same problems and the same confusion as that unintentionally produced with the convincing mosaic test.

The convincing mosaic test was an important diversion from the primacy of McDonnell Douglas.  I worry that sounding the death knell of the convincing mosaic test will return McDonnell Douglas to its primacy in the Seventh Circuit.

More praise for Ortiz

There is so much to like about Ortiz. It recognized a fundamental problem with the employment discrimination frameworks.  Ortiz noted:

And the direct-and-indirect framework does nothing to simplify the analysis. Instead it complicates matters by forcing parties to consider the same evidence in multiple ways (and sometimes to disregard evidence that does not seem to fit one method rather than the other).

The Seventh Circuit has explicitly required lower courts to stop dividing evidence into direct and indirect frameworks and to consider it as a whole.