“So, When Do You Plan To Retire?” Pause Before Asking This Potentially Loaded Question

A recent Ninth Circuit court decision shows the dangerous path employers walk when they start asking employees questions about retirement, especially when coupled with other age-related comments or actions.

The federal Age Discrimination in Employment Act (ADEA) protects applicants and employees who are age 40 and over. California’s Fair Employment and Housing Act also provides such protections. To get to trial, an employee who claims age discrimination can use direct or circumstantial evidence that age was a motivating factor in the employer’s decision-making process.

In France v. Johnson, a federal border patrol agent was allowed to proceed to trial against the Department of Homeland Security (DHS) on a claim that he was denied a promotion due to his age.

The Ninth Circuit decision highlights a couple of key points.

Repeated Retirement Discussions, But Employee Isn’t Interested in Retiring

John France is a border patrol agent assigned to Tucson, Arizona. In March 2007, a pilot program was created that would divide the patrol agents into two categories. In 2008, four GS-15 positions were created as result of the pilot program.

Twenty-four eligible candidates applied for the positions, including France who, at age 54, was the oldest of the candidates. The candidates’ ages ranged from 38 to 54 years old. The four candidates who were ultimately selected for the GS-15 positions were 44, 45, 47 and 48 years old.

France sued DHS claiming that the promotion decision was based on age. DHS, on the other hand, claimed France lacked the leadership, judgment, flexibility and innovation for the position and argued these were legitimate, nondiscriminatory reasons for not promoting him.

France offered the following evidence to support his claim that the agency’s nondiscriminatory reasons were, in fact, just a cover for age discrimination.

  • Chief Patrol Agent Gilbert expressed his preference in a staff meeting for “young, dynamic agents” to staff the GS-15 positions.
  • Gilbert had repeated retirement discussions with France, despite the fact that France clearly indicated that he did not want to retire. For example:
    • In June 2007, Gilbert asked if France was interested in teaching firearms after he retired, but France said he didn’t want to retire.
    • A few months later, Gilbert again asked France what he wanted to do after retirement and France said he wasn’t going to retire but planned to apply for the GS-15 position. Gilbert responded that if he were in France’s position, he would retire as soon as possible.
  • Gilbert was on the panel of interviewers for the GS-15 positions. He also made the recommendation of four of the top six candidates for final consideration. Those four candidates were ultimately chosen.
  • France offered testimony from other agents that Chief Border Patrol Agent Aguilar, who also made a recommendation of the final four candidates, preferred younger, less experienced agents.

The lower court found that France could not show enough evidence of pretext to proceed to trial and granted the agency’s motion for summary judgment to get the case dismissed before trial.

On appeal, the Ninth Circuit disagreed, and France will be allowed to proceed with his lawsuit.

Does the Difference in Age Matter?

DHS argued that there couldn’t possibly be a case of age discrimination here because the people who were promoted weren’t really that much younger than France.

A failure-to-promote case requires that the promotion be given to a “substantially younger person.” In this case, the average age difference between France (54) and the four selected candidates (44, 45, 47 and 48) was eight years. It’s irrelevant that the promoted individuals were over the age of 40 – it just matters if they were “substantially” younger.

In addressing DHS’s argument, the Ninth Circuit adopted a bright line “workable” rule also applied by other circuits:

  • An average age difference of 10 years or more between the complaining party and his/her replacements will be presumed as substantially younger.
  • An average age difference of less than 10 years will be presumed to be insubstantial. However, if the age difference is less than 10 years, a complainant can rebut the presumption by producing additional direct or circumstantial evidence to show that the employer considered the complainant’s age to be a significant factor.

In this case, the average eight-year age difference was presumptively insubstantial to raise a claim. But the court did not stop the analysis there. The Ninth Circuit went on to look at whether France had enough evidence to show that DHS considered his age to be significant.

Enough Evidence to Go to Trial

France, according to the court, had direct and circumstantial evidence that DHS considered his age to be significant in making its promotion decision. The remarks about wanting a “young, dynamic agent” coupled with the retirement discussions were enough to create an inference of age discrimination – at least enough for France to get to trial.

The court noted that the total circumstances will be looked at. Although each event alone might not be enough, the sum total of the discussions created the inference.

The timing of the unwanted retirement discussions was also significant to the court’s decision because they occurred right before the GS-15 positions were posted.

“The close proximity in time could allow a reasonable jury to find by a preponderance of the evidence that France’s non-selection based on grounds other than age was pretextual,” said the court.

Further, even though Gilbert wasn’t the ultimate decision maker, the court found that he influenced the decision-making process.

Best Practices

This case highlights important points for employers to remember:

  • Be careful about retirement discussions with an employee that could be interpreted as a desire to push an older worker out. A red flag should be raised if you are having those discussions at the same time as you are making employment decisions regarding that individual.
  • Employers will want to provide factual retirement information to employees at, say, a company-wide benefits meeting, but pressing employees on when they plan to retire or uninvited discussions about voluntary retirement plans are dangerous.
  • A mandatory retirement age is generally prohibited under both California and federal law. Certain limited exceptions apply to executives and some public employees.
  • Specific rules govern the ability of employers to offer early retirement incentive benefit plans. Consult with your benefits adviser or benefits counsel to ensure that any such plan complies with both federal and state law.

When making hiring, promotion and disciplinary decisions, an employer will want to look at the big picture to make sure that the decision is being made for well-documented, objective reasons.

 

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