Performance-Evaluation System-Adverse Age Impact
Murphy, Betty Southard, Barlow, Wayne E., Hatch, D. Diane, Personnel Journal
Reversing a federal district court's decision, the U.S. court of Appeals for the Seventh Circuit has held that a computerized job-evaluation system that resulted in the discharge of a disproportionate number of older workers may constitute unlawful discrimination in violation of the Age Discrimination in Employment Act. Because of the adverse impact, the terminated employees are entitled to a trial on that claim.
In 1984, Transco Services implemented the "Measured Day work Program" at an A&P warehouse it managed in Milwaukee, Wisconsin. The system was designed to measure and evaluate the performance of full-time order selectors who retrieved and loaded goods and completed paperwork relating to the order requests.
The system analyzed each incoming order and predicted the number of minutes needed to complete it. The system included variables to assess the size and weight of the goods, the location in the warehouse, the distance from the loading platform and the degree of difficulty n retrieving a particular item.
In addition, the program allowed a certain number of minutes for rest breaks. In an eight-hour workday, an employee was expected to perform 407 minutes of work and received 73 minutes of break time. Employees were expected to maintain a ration of standard-to-actual time of 1:1, or 100%. Any selector who fell within the lowest 20% of employees working that week was subject to progressive discipline leading to discharge.
Transco terminated John W. Fischer at the age of 45, in March 1985. In April 1985, Transco also fired 42-year-old Richard Kirchhoff. Both employees claimed that at least three of the disciplinary warnings they received were improper and that they should not have been terminated.
Transco dropped the program on August 3, 1985, after 48 weeks. Out of 1,182 weekly measurements taken, only 20 measurements were at or above the 100% level. …