• Supreme Court Limits Use of Disparate Impact Claims in Age Discrimination Cases
  • April 18, 2005 | Author: JoAnne Sweeny
  • Law Firm: Manatt, Phelps & Phillips, LLP - Los Angeles Office
  • The United States Supreme Court has recently held that, although "disparate impact" cases are cognizable under the Age Discrimination in Employment Act of 1967 (ADEA), they are more limited than similar claims under Title VII. [Smith v. City of Jackson, Mississippi, No. 03-1160 (March 30, 2005).]

    In Smith, police and public safety officers (the "Officers") brought suit against the City of Jackson, Mississippi (the "City"), under the ADEA because the salary increases they received were less generous than the increases received by younger officers. The Officers brought suit under a disparate impact theory, alleging that, under the City's employee pay plan, officers with less than five years' service received proportionately greater raises than those with more seniority, and most officers over 40 had more than five years of service. The United States District Court for the Southern District of Mississippi granted summary judgment for the City and the United States Court of Appeals for the Fifth Circuit affirmed the dismissal of the disparate impact claim. The Supreme Court, in a divided opinion, also affirmed the dismissal.

    Because the language of Title VII of the Civil Rights Act of 1964 Section 703(a)(2) and the ADEA Section 4(a)(2) are essentially identical, the Supreme Court held that plaintiffs may bring disparate impact claims under the ADEA because those claims are allowed under Title VII. However, due to two other textual differences, the Supreme Court held that the disparate impact theory's scope under the ADEA is narrower than under Title VII.

    The first difference between the two statutes is that, under the ADEA, "otherwise prohibited" action is permissible "where the differentiation is based on reasonable factors other than age." No such exception exists in Title VII. The second difference is Congress' failure to amend the ADEA in 1991 when it amended Title VII to hold employers to a higher standard of proof in disparate impact cases. Here, the Supreme Court found Congress' failure to amend the ADEA as indicative that it should have a narrower disparate impact scope.

    The Supreme Court held that the Officers failed to make out a disparate impact claim under the ADEA's narrower standards because their complaint did not identify any specific test, requirement, or practice within the City's pay plan that had an adverse impact on older workers -- the Officers merely pointed out that the City's pay plan at issue was relatively less generous to older workers than to younger workers. The Supreme Court also found that the City's pay plan was based on reasonable factors other than age ¿ the City raised the starting salaries of police officers based on the City's desire to make these junior officers' salaries competitive with comparable positions in the market.

    The holding in Smith makes clear that ADEA claims may be brought against employers for practices that have a disparate impact on older workers even if the employer does not intend to discriminate. However, compared to similar claims under Title VII, ADEA disparate impact claims will place a much higher burden on employees to identify the specific discriminatory practice, and a lower burden on employers to prove that the disputed practice is based on factors other than age.