Employers may use age as a valid criterion to award more lucrative benefits to older workers without violating the Age Discrimination in Employment Act.
In an important age-bias case, the US Supreme Court Tuesday sided with older workers in ruling that the ADEA does not empower relatively younger workers to file so-called reverse-discrimination lawsuits.
Instead, in 6-to-3 decision, the court said the law was intended to protect older workers from workplace discrimination that favors younger workers.
"If Congress had been worrying about protecting the younger against the older, it would not likely have ignored everyone under 40," writes Justice David Souter for the majority.
The decision is significant because it upholds the continued use of age as a valid triggering mechanism in early-retirement incentive plans and retirement packages negotiated through collective bargaining agreements. Such packages often use age as a means to apportion more lucrative benefits based on the advancing age of each worker.
The ADEA outlaws age-based discrimination in the workplace against any worker 40 or older. Some 70 million workers - about half the nation'sworkforce - are 40 or older.
At issue in the case was how that prohibition should apply to alleged age discrimination among workers who were all at least 40 years old, and thus covered by the protections of the ADEA. More precisely, the question was whether the ADEA bars any use of age as a criterion for special treatment in the workplace. If so, it would permit so-called reverse-discrimination lawsuits by younger workers challenging retirement incentive plans that offer more lucrative benefits to older workers based on their age.
Some analysts argued that the high court has sustained similar reverse-discrimination interpretations of civil rights statutes. Title VII of the 1964 Civil Rights Act was designed to protect minorities by prohibiting racial discrimination in employment. But the court has read the law to also outlaw same-sex sexual harassment and racial discrimination claims filed by whites.
The majority justices said that age discrimination is different. The court ruled that when age is teamed with the word discrimination it effectively means old age. The court ruled that the purpose of the law was to protect "older" workers from discrimination.
Three justices dissented: Antonin Scalia, Clarence Thomas, and Anthony Kennedy. In their view, the statute authorizes anyone to sue for discrimination whenever age is used as a job criterion.
The decision stems from a class action lawsuit filed by Dennis Cline and nearly 200 other employees at General Dynamics plants in Ohio and Pennsylvania. The plants produce Abrams tanks for the US military.
In 1997, General Dynamics and the employees' union, the United Auto Workers, reached an agreement on a projected cutback in retirement benefits: All employees with 30 years of seniority who were age 50 or older by July 1, 1997, would continue to receive full health benefits upon retirement. Those younger than 50 would not. At the time, Mr. Cline was 47 years old and had put in 28 years at the plant. In his suit, Cline charged that he'd been denied lucrative benefits solely because of his age in violation of the ADEA. A federal judge threw the suit out. But a panel of the Sixth US Circuit Court of Appeals reinstated the suit.