Shifts in demographic trends and judicial reasoning have combined to set the stage for a rapid rise in the risks posed by unsuccessful job candidates who fall within the protected class of workers age 40 and older under the Age Discrimination in Employment Act.
In 2000, 23 percent of the U.S. population was in the 45-84 age group. By 2010, this portion will rise to 37.2 percent, and by 2020 it will hit 39 percent, according to the U.S. Census Bureau. A new survey from Pew Research found that 70 percent of today’s workers expect to work after retirement. The surge of older workers remaining in or re-entering the workforce underscores the importance of training recruiters and hiring managers to avoid age discrimination charges.
In addition, the courts have signaled that they are prepared to entertain a broader approach to age discrimination claims. In February 2007, the U.S. Court of Appeals for the 2nd Circuit put employers on notice that age discrimination claims arising from the hiring process will get a full hearing if the employer’s defense appears to be pretext.
In D’Cunha v. Genovese/Eckerd, an older applicant qualified for a pharmacist position in a phone screening but was then rejected in favor of a younger candidate after the face-to-face interview. Eckerd was unable to demonstrate a nondiscriminatory reason for rejecting the older candidate.
Juries are aging along with the workforce.
"Age claims present unique risks," says Ron Chapman Jr., shareholder at Ogletree Deakins in Dallas. "Every juror can relate to growing old. Juries are more likely to identify with the plaintiff."
"We will see a new wave of age-related claims," says Connie Bertram, partner in Winston & Strawn’s Washington office. "Employers need to start thinking about the age spread in various positions and make sure they pay the same attention to age as they do to race and gender in the hiring process."
In fiscal 2006, the Equal Employment Opportunity Commission received 16,548 charges of age discrimination, resolved 14,146 charges and recovered $51.5 million in monetary benefits, not including monetary benefits obtained through litigation.
Although there are fewer age discrimination claims than race or gender claims, plaintiffs in age claims are more likely to be successful and the money amounts are generally higher, Bertram reports. She advises employers to adjust any obvious imbalances in the age composition of their workforce and to boost efforts to train recruiters and managers to avoid age discrimination issues in the hiring process.
"The potential for an increase in age discrimination claims is rising for two key reasons," says Dominic Messiha, shareholder at Littler Mendelson in Los Angeles. "First, for the past five to seven years at both the federal and state level, court decisions have weakened the defense against age discrimination claims. Secondly, particularly in the retail sector, the decisive shift toward a focus on youth in marketing and sales may lead employers into dangerous territory."
The fact that a recruiter or interviewer is more than 40 years of age and therefore part of the protected class is no longer a defense against claims of age discrimination.
"Being part of the protected class does not protect you from age discrimination claims if there is a substantial difference in age," Messiha says.
Also, hiring a candidate who is within the protected class of workers age 40 and older is no longer a solid defense against a claim by an unsuccessful older candidate.
"The Supreme Court has ruled that all there has to be is a ‘substantial difference’ in the ages, so just because you hired someone who is 41 doesn’t mean that you didn’t discriminate against a candidate who is 60," Bertram notes.
In addition, the Supreme Court recently noted that disparate impact based on age has been applied to compensation and promotion issues and will likely apply to hiring, Bertram reports. If, for example, the employer has a physical job requirement that has the impact of excluding older candidates but is not actually necessary for the position, an age discrimination claim could be based on disparate impact.
The weakening of traditional defenses against age discrimination claims and the broader approach taken by the courts increases the risk of successful claims arising from any of the various stages of the hiring process. Outreach methods, for example, may generate claims if there is an adverse impact caused by heavy reliance on campus recruiting.
"Employers must be careful to also post positions and use job boards to broaden outreach," Bertram says.
The ADEA specifically prohibits statements or specifications in job notices or advertisements of age preferences or limitations. Sara Begley, a partner at Reed Smith in Philadelphia, reminds employers to avoid language that either limits the pool of eligible applicants to younger applicants or deters older applicants from applying for the job. Such terms would include "college student" or "recent graduate." She notes that employers must also avoid language that seeks a segment of workers protected under the ADEA but tends to discourage others also protected under ADEA, such as references to "retirees" or jobs that can "supplement your pension."
Interviews represent a high-risk moment in the chain of events that lead to filling a position. Although many HR departments have trained recruiters and hiring managers to avoid direct references to age, potentially discriminatory language may take more subtle forms.
"Issues arise in the hiring process from oblique references to age," notes Gregory Rasin, partner in the labor and employment law department of Proskauer Rose in New York. "For example, the interviewer explains that the workdays for the position may be long and asks if the applicant would have enough ‘energy’ for long hours, or the interviewer asks the applicant if he or she would mind working under a younger supervisor."
Messiah says that the solution is to train hiring managers to use a script of questions and to ask only those questions. It is also preferable to have multiple interviewers, with each scoring the applicant individually. If the candidate makes references to age, those should not be recorded in the interviewers’ notes and should not receive any response.
Chapman reports that two themes permeate age-related claims: overqualification and the perceived inability to adapt. "With respect to the overqualification, the best approach is to offer the job at the salary that would normally be offered," he advises. "Arguing that overqualified candidates commonly leave the job is a dangerous defense."
Rejecting candidates based on the perceived inability to adapt can be indicative of a reliance on stereotypes, he notes. "Instead of asking candidates the broad and potentially age-based question of if they can adapt to a rapidly changing environment, ask a better question—one that is tied to the specifics of the job."
"Overqualification is a completely legitimate reason to reject a candidate, because overqualified employees commonly become dissatisfied after six months and generate numerous problems," Bertram says. "But employers must be able to articulate the reason why overqualification is a problem. There is a high risk associated with not hiring on the basis of overqualification."
Messiha outlines steps that HR executives and recruiting directors can take to minimize the risk of age discrimination claims:
Broaden your recruiting efforts. Companies need to be careful about how they target potential applicant pools and avoid outreach efforts that may yield a disproportionate number of young applicants—for example, recruiting at college campuses or shopping malls, or advertising in media aimed at a young audience.
Don’t interview people you will never hire. "Some employers bring in candidates because they think they can score points by interviewing a diverse group, but this drastically increases the company’s exposure to discrimination claims," Messiha warns. "Focus on carefully screening and analyzing applications before you bring in candidates."
Tap a diverse group of decision-makers for the recruiting and hiring process. "Put your diverse foot forward in all your recruiting and hiring activities," Messiha advises. "It’s important to have demographic variety in your recruiting and hiring teams."
Interview candidates only for the position they applied for. If the recruiting staff failed to carefully screen candidates and brings in someone who is unsuitable, the interviewer may try to correct the situation by interviewing the candidate for a different open position. Particularly if the other position is lower-paying, candidates may suspect discrimination.
Always maintain a diverse workforce. "This is the best defense in hiring claims," Messiha notes. "Diversity statements and statistics usually cover race, gender and even religion, but they need to focus equally on age."
If unsuccessful candidates ask questions after they have been rejected, consult with human resources and counsel before you reply. "What is said at this stage is potentially more important than what was said in the interview," Messiha says
Messiha notes that all employment-related litigation is counter-cyclical, with a lag of six to nine months.
"We are at the end of a wave of wage-hour litigation, so we believe that the next downturn could touch off a new round of discrimination cases, including age-related claims," he says. HR executives and recruiting directors should act now to put their house in order.