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Age Bias Suit at Circuit City
Posted: 04/10/2007, 9:45 AM PT
Circuit City’s decision to get rid of some 3,400 workers
because they were getting paid “well above the market-based salary range for
their role,” according to the company, seemed to me to be a curious way to
handle your workforce. Why would a company struggling to compete with strong
competitors like Best Buy think that canning the highest-paid (and therefore,
probably its best) workers is a winning workforce strategy.
It’s not, of course, and now the other shoe has dropped:
Three older Circuit City workers who lost their jobs as a result of this “wage
management initiative” (the company-speak for firing people) have sued the
company, claiming that the electronics retailer violated California’s age
discrimination laws when it laid them off.
California’s Fair Employment and Housing Act is tougher
than laws in most states, and a 2002 amendment says that using salary as the
basis to terminate workers may constitute age discrimination if older workers,
as a group, find that they are negatively affected.
The three workers suing Circuit City are all age 57 or
older. Their attorney, Gloria Allred, told the Los Angeles Times that the Circuit City
action had an “adverse impact on older employees.” She is seeking class-action
status for the case, although it is unclear how many of the more than 600
Circuit City employees fired in California are 40 or older. “Terminated
employees in other states may or may not have any rights depending on their
state laws,” Allred told the Times,
“but California is on the cutting edge of laws that protect employees’ right
from age discrimination.”
This is not only a bad decision (as I
wrote in my latest Last Word
column), but it is also incredibly stupid
and shortsighted. I’ve created a new honor, the Stupidus Maximus Award, to
recognize the “most ignorant,
shortsighted and dumb workforce management practice of the year.” If you have a
good nominee, send them along to me at jhollon@workforce.com. Circuit City is
clearly a front-runner for 2007 “honors.”
Next Post: 2. Bad Press a Bummer for JetBlue
JetBlue is finally growing up. CEO David Neeleman and his team have lived a charmed existence during their eight years in business, and the press has been generally positive and supportive. That’s all well and good, but nothing lasts forever.
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John Hollon
Workforce Management editor John Hollon is an award-winning journalist with more than 20 years' experience as a newspaper, magazine, Internet and business journal editor. He holds a bachelor's degree in journalism from California State University, Long Beach, and an MBA from Pepperdine University's Graziadio School of Business and Management.
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Previous Posts
1. Age Bias Suit at Circuit City
2. Bad Press a Bummer for JetBlue
JetBlue is finally growing up. CEO David Neeleman and his team have lived a charmed existence during their eight years in business, and the press has been generally positive and supportive. That’s all well and good, but nothing lasts forever.
3. Culture Clash the Culprit at Tribune
There are a lot of issues behind the sale this week of the Tribune Co., owner of the Los Angeles Times, Chicago Tribune and a number of other newspapers and TV stations, to Chicago real estate magnate Sam Zell, but the No. 1 issue in my book comes down to a culture clash.
4. How to Fire Up the Troops
Want to know how to rally the workforce and get people excited about following you into a tough battle against your business competition? Here’s the formula as demonstrated this week by Dell CEO Michael Dell:
5. Job Cuts vs. the “War for Talent”
It’s hard to get shocked anymore by businesses cutting jobs. In some sectors—like newspapers, where The Tampa Tribune this week announced a cut of 70 staff positions—layoffs and cutbacks have become so common that they have ceased to be newsworthy since they seem to happen every day. And that is exactly why yesterday’s big layoff announcement from banking giant Citigroup was so surprising.
6. Losing the Managerial Mojo
7. Sizing Up Candidates—The Two-Minute Rule
I get lots of press releases in the course of a week, and few of them catch my eye. However, this one did: A Robert Half International Survey of senior Canadian executives says that it takes 12 minutes, on average, for the executives to form an opinion about a job seeker they are interviewing.
8. Soft Skills, Outsourcing and Working Until You Drop
I’ve been on the road for the past week, so my apologies for being away from the blog during that time. Here are some interesting surveys that came across my desk while I was gone.
9. Some Conference Speakers Worth Hearing
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