Supreme Court - Adverse Impact Theory Available Under the ADEA

While the full impact of the decision may take some time for the courts and employment attorneys to workout, it is now clear that adverse impact is a viable theory under the ADEA. Here's the full text of the case: Smith v. City of Jackson. And here is a link to the Washington Post article regarding the case.Justice Stevens delivered the opinion of the Court with respect to Parts I, II, and IV, concluding: 1. The ADEA authorizes recovery in disparate-impact cases comparable to Griggs. Except for the substitution of "age" for "race, color, religion, sex, or national origin," the language of ADEA §4(a)(2) and Title VII §703(a)(2) is identical. Unlike Title VII, however, ADEA §4(f)(1) significantly narrows its coverage by permitting any "otherwise prohibited" action "where the differentiation is based on reasonable factors other than age" (hereinafter RFOA provision). Pp. 2-4. 2. Petitioners have not set forth a valid disparate-impact claim. Two textual differences between the ADEA and Title VII make clear that the disparate-impact theory's scope is narrower under the ADEA than under Title VII. One is the RFOA provision. The other is the amendment to Title VII in the Civil Right Act of 1991, which modified this Court's Wards Cove Packing Co. v. Atonio, 490 U. S. 642, holding that narrowly construed the scope of liability on a disparate-impact theory. Because the relevant 1991 amendments expanded Title VII's coverage but did not amend the ADEA or speak to age discrimination, Wards Cove's pre-1991 interpretation of Title VII's identical language remains applicable to the ADEA. Congress' decision to limit the ADEA's coverage by including the RFOA provision is consistent with the fact that age, unlike Title VII's protected classifications, not uncommonly has relevance to an individual's capacity to engage in certain types of employment. Here, petitioners have done little more than point out that the pay plan is relatively less generous to older workers than to younger ones. They have not, as required by Wards Cove, identified any specific test, requirement, or practice within the pay plan that has an adverse impact on older workers. Further, the record makes clear that the City's plan was based on reasonable factors other than age. The City's explanation for the differential between older and younger workers was its perceived need to make junior officers' salaries competitive with comparable positions in the market. Thus, the disparate impact was attributable to the City's decision to give raises based on seniority and position. Reliance on these factors is unquestionably reasonable given the City's goal. Pp. 11-14. Justice Stevens, joined by Justice Souter, Justice Ginsburg, and Justice Breyer, concluded in Part III that the ADEA's text, the RFOA provision, and Equal Employment Opportunity Commission (EEOC) regulations all support the conclusion that a disparate-impact theory is cognizable under the ADEA. Pp. 4-11. Justice Scalia concluded that the reasoning in Part III of Justice Stevens' opinion is a basis for deferring, pursuant to Chevron U. S. A. Inc. v. Natural Resources Defense Council, Inc., 467 U. S. 837, to the EEOC's reasonable view that the ADEA authorizes disparate-impact claims. Pp. 1-5. Justice O'Connor, joined by Justice Kennedy and Justice Thomas, concluded that the judgment should be affirmed on the ground that disparate impact claims are not cognizable under the ADEA. Pp. 1-22.

And yes you read that correctly, Justice O'Conner wrote the dissent while Scalia joined the majority on the grounds of "deference to the EEOC's reasonable view." Hmmmm...