General Dynamics Land Systems, Inc. v. Cline
"The enemy of 40 is 30, not 50" – The ADEA does not prohibit reverse age discrimination.
On February 24, 2004, the Supreme Court issued its decision in General Dynamics Land Systems, Inc. v. Cline. The Court held that the Age Discrimination in Employment Act (ADEA) was not intended to protect relatively younger workers from discrimination based on age. "The question in this case" Justice Souter wrote, is whether "the ADEA also prohibits favoring the old [in this case employees who were 50 or older]over the young [employees who were between the ages of 40 and 49]. We hold it does not."
In 1997, General Dynamics and the United Auto Workers renegotiated their contract. The new contract eliminated the company’s obligation to provide health insurance to new retirees, unless the employee was already 50 years old or older at the time the contract went into effect.
Employees of General Dynamics who were 40 or older (and therefore protected employees under the ADEA), but
younger than 50 (and therefore no longer entitled to health benefits upon retirement), filed a class action lawsuit against the company in the Northern District of Ohio. The district court dismissed the claim, holding that the ADEA contained no prohibition against reverse age discrimination.
Cline appealed the district court’s decision to the 6th Circuit Court of Appeals. The 6th Circuit disagreed with the district court, finding that the statute clearly protected any individual 40 or over who was being discriminated against based on age. This decision created a split among the circuits, and the Supreme Court agreed to hear the case to resolve the issue.
The Supreme Court decision
The Supreme Court reversed the 6th Circuit, finding that Congress intended only to protect older workers from discrimination. The Court looked to the legislative history of the ADEA, the statute itself, and the regulations promulgated under the statute. These sources "make a case that we think is beyond reasonable doubt, that the ADEA was concerned to protect a relatively old worker from discrimination that works to the advantage of the relatively young." Confirming this interpretation, the Court said, is the fact that Congress extended the protection of the ADEA only to those 40 or older in the first place. Additionally, prior Supreme Court decisions interpret the ADEA to protect older workers and leave "complaints of the relatively young outside the statutory concern."
This decision ends concern over potentially significant liabilities that were created by the 6th Circuit’s prohibition of "reverse age discrimination." Had the 6th Circuit been upheld, an employer might have been sued by an employee 40 or older if benefits were extended only to more senior employees. For example, offering enhanced severance benefits to employees over 50 years old would have been a violation of the ADEA in the 6th Circuit. In this regard, the decision is important for what it does not do to employers.
Finally, this decision should remind employers of the importance of relevant state and federal laws regarding employment. It is important to keep in mind that these laws extend beyond forming and implementing policies in hiring, firing, and salaries. It is also important to examine polices as they relate, for example, to discipline and benefits.
If you have any questions about this ruling’s impact on your company, if you would like our firm to conduct a review of your policies, or if you have other employment law related questions, please contact one of our labor and employment attorneys.