Age Discrimination in Employment Act Does Not Prevent Businesses from Offering Older Workers Better Retirement or Health Plan Than That Available to Younger Workers
Stempel, Jeffrey W., Journal of Risk and Insurance
General Dynamics Land Systems, Inc. v. Cline, 124 S. Ct. 1236, 157 L. Ed. 2d 1094, 2004 U.S. Lexis 1623 (U.S. Supreme Court--February 24, 2004)
As the saying goes, youth is wasted on the young. But on the other hand, the law provides substantial protection to the old (who not incoincidently vote at about twice the rate of the young). For example, the Age Discrimination in Employment Act ("ADEA") protects workers over the age of 40 years from adverse job actions because of age. It condemns age discrimination, at least against older workers. In that sense, it is like other civil rights laws that preclude businesses from discriminating against racial minorities or on the basis of gender. Laws preventing race or gender discrimination have generally been interpreted to permit so-called "reverse discrimination" suits by persons outside the protected groups if persons in the protected group are not only protected from discrimination but also given privileges denied to others. For example, a company could not give women executives a Mercedes as a company car while giving similarly ranked male executives a Kia.
In Cline, the Supreme Court was faced with the question of whether the ADEA contains the same bar to reverse discrimination. The Court concluded that because the ADEA differs in important ways from Title VII or other civil rights laws, a company may favor older workers without committing illegal age discrimination. In other words, the ADEA is a "one-way" antidiscrimination statute barring discrimination against those over 40 but not a "two-way" antidiscrimination statute barring all disparate treatment because of age.
In 1997, General Dynamics entered into a collective bargaining agreement with the United Auto Workers union, which "eliminated the company's obligation to provide health benefits to subsequently retired employees, except as to then-current workers at least 50 years old." See 2004 U.S. LEXIS 1623 at *8. In other words, General Dynamics' workers that were over 50 in 1997 would have a better retirement package than those under 50, meaning that it was generally more advantageous to be a 51-year-old company worker rather than a 49-year-old company worker. Dennis Cline was then over 40 (the age triggering ADEA protections) but under 50. Cline and others in this age group objected to the new health-benefit terms of the collective bargaining agreement, complaining to the Equal Employment Opportunity Commission (EEOC) that the agreement violated ADEA by discriminating against them with respect to terms and conditions of employment because of their age. The EEOC agreed and informally intervened to attempt a negotiated resolution with the company.
When negotiations failed, Cline sued General Dynamics. The trial court, determining that ADEA provided no cause of action for "reverse age discrimination," dismissed the claim. A divided panel of the U.S. Court of Appeals for the Sixth Circuit (covering the states of Michigan, Ohio, Kentucky, and Tennessee) reversed, finding that any disparate treatment because of age is forbidden by the ADEA unless it is clearly authorized by the Act (e.g., certain jobs with demanding physical requirements can exclude older applicants). Of particular influence to the Sixth Circuit was that the EEOC backed Cline on this question. …