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Supreme Court Case Could Expose Employers to More Age Bias Trials

The central issue in the case for employers is whether the Supreme Court will affirm an appeals court decision and ‘blur’ the distinction between ADEA and the Title 7 federal discrimination statute.

January 10, 2008
Related Topics: Discrimination and EEOC Compliance, Retention, Strategic Planning, Latest News
Deputy sheriffs are exposed to danger every day on the job. But in Kentucky, if they get shot and put out of work, the amount of benefits they can receive depends on when in their career the incident occurs.

Under Kentucky law, people who work in hazardous public service occupations can retire after 20 years of service or when they’re 55—as long as they’ve worked at least five years by that time.

But safety officers are ineligible for disability payments if they are 55 or older because they already qualify for retirement benefits. Younger colleagues who are injured can receive disability until they reach retirement age.

This situation produced a lawsuit by a Jefferson County Sheriff’s Department employee, Charles Lickteig, who was disabled at age 61 after 18 years of service and was denied disability benefits.

Lickteig filed an age discrimination suit with the Equal Employment Opportunity Commission, asserting that younger workers are treated better in the Kentucky system.

A federal district court ruled in 2003 that Kentucky did not discriminate based on age. But the full 6th Circuit Court of Appeals reversed the decision, 10-4, finding that Kentucky excludes workers from disability benefits because of their age. The state appealed to the Supreme Court.

In an oral argument before the high court on Wednesday, January 9, Robert Klausner, an attorney for Kentucky Retirement Systems, said that state policy does not violate the Age Discrimination in Employment Act. It simply fills in the gap between the time a younger employee is hurt and retirement.

“It’s about retirement eligibility, not about age,” Klausner said. “What this case is about … is being fair without regard to age.”

Malcolm Stewart, an assistant to the solicitor general who is representing the EEOC, argued that the Kentucky program is unfair to employees already working beyond retirement age.

“There is no reason to think that the older people … as a group will have fewer years in the line of fire than younger people,” Stewart said. “What [Kentucky] can’t do is use age as a proxy, as the basis for how many years that person would have worked if he or she had not been disabled.”

The state does not use age to arbitrarily lower benefits for older workers, according to Klausner. Age is merely coordinated with pension status.

But Stewart said that Kentucky “should use the same computational methodology for both categories of employees.”

The central issue in the case for employers is whether the Supreme Court will affirm the appeals court decision and “blur” the distinction between ADEA and the Title 7 federal discrimination statute, according to Sara Begley, a partner at Reed Smith in Philadelphia.

The ADEA gives companies room to consider age in determining retirement eligibility if there are significant cost considerations involved. There is no such flexibility under Title 7.

“It would make it a lot tougher for an employer to get a trial kicked out on summary judgment,” Begley said of the consequences if the Supreme Court sides with the appeals court. “It will up the ante in terms of putting pressure on employers to settle age cases.”

In addition, the Supreme Court may rule on whether younger workers are getting a larger benefit than older workers, Begley said.

“The real issue here is the calculation that Kentucky has used to determine the level of benefits for employees who are disabled under 55 years of age,” she said.

At different times, Justice Stephen Breyer seemed to agree with each side. In commenting on the Kentucky bifurcation between employees younger and older than 55, he said, “It takes disabled people and cuts their benefits.”

Later, he depicted the EEOC as “using mechanical rules” of pension systems, which are based in part on age, to find a way to demonstrate that there is discrimination.

“Before you know it, you are in the kind of a—of a hamburger situation, where it’s so chopped up that perfectly worthwhile things are forbidden,” Breyer said.

Mark Schoeff Jr.

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