November 11, 2016

11th Circuit Rules Adverse Impact Is Not a Viable …

The case is Villarreal v. R.J. Reynolds [2016 U.S. App. LEXIS 18074] decided on October 5, 2016 in an 8 to 3 en banc ruling by the 11th Circuit. At issue was an advertisement by the defendant for recent college graduates. Richard Villarreal, the plaintiff, was 49 years old when he filed his first claim against R.J. Reynolds, and he has filed several subsequent claims, each on other occasions in which he applied for a job and was not hired. The district court granted summary judgment to the defendant and Villarreal won an initial appeal to a 3-judge panel of the 11th Circuit. However, the 3-judge panel ruling was overturned 8-3 in a subsequent en banc ruling. The en banc ruling means (1) applicants and employees may use disparate treatment theory in ADEA claims; (2) employees may use adverse impact in ADEA claims; but (3) applicants are prohibited from using adverse impact theory in ADEA claims.

 

This ruling is based on a literal reading of ADEA statutory language.  Specifically, Section 4(a)(2), 29 U.S.C. § 623(a)(2) of the statute makes it unlawful for an employer:

to limit, segregate, or classify his employees in any way which would deprive or tend to deprive any individual of employment opportunities or otherwise adversely affect his status as an employee, because of such individual’s age.”

 

The key terms here are “adversely affect”, which implies adverse impact but not disparate treatment and “employee”, the literal meaning of which excludes applicants.

 

Paying deference to the EEOC, the 3-judge panel ruled that despite the omission of applicant in the targeted statutory language, the EEOC had “reasonably and consistently” interpreted the statute to permit adverse impact claims by applicants, and that doing so was in keeping with the objectives of the statute.

 

However, eight members of the en banc panel disagreed with the 3-judge panel and reinstated the district court ruling that the plain language in the statute does not cover applicants for employment.  The majority emphasized that deference to EEOC interpretations are improper and in direct contradiction to plain statutory language, and that is “our job is to follow the text even if doing so will supposedly undercut a basic objective of the statute.”

 

We will have to stay tuned to see how other circuit courts weigh in on these issues.  I think the issues merit Supreme Court review, but more than one circuit court ruling is generally needed to get one.

 

By Art Gutman, Ph.D., Professor, Florida Institute of Technology

 

For more blog posts on EEO Case Law, click here.

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DCI Consulting is a risk management human resources consulting firm strategically located in Washington, D.C.

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