VirginiaLaborLaw.com |  |
|
NEWS
ALERT
Gross v. FBL Financial Services, Inc. (June 18, 2009): United States Supreme Court Shifts Burden of Persuasion from Employers to Workers in Mixed-Motive Cases Under Age Discrimination in Employment Act, Eliminates Direct Evidence Requirement, and Perhaps Moves Away from Title VII Cases as ADEA Precedent
By Raymond L. Hogge, Jr.
June 19, 2009
The Age Discrimination in Employment Act of 1967 (ADEA), 29 U. S. C. § 621 et seq., provides that "it shall be unlawful for an employer . . . to fail or refuse to hire or to discharge any individual or otherwise discriminate against any individual with respect to his compensation, terms, conditions, or privileges of employment, because of such individual’s age." 29 U. S. C. § 623(a)(1). Under well- established Fourth Circuit law, as well as under the law of most other federal circuits, a worker could prove an adverse employment action was taken against him "because of" his age in either of two ways.
First, he could establish discrimination using a "pretext" framework "identical to the McDonnell Douglas burden-shifting analysis used in Title VII cases."
Alternatively, in "mixed motive" cases in which the employer's action was motivated by both permissible and discriminatory motives, the worker could use the burden-shifting framework adopted by the Supreme Court in Price Waterhouse v. Hopkins, 490 U.S. 228 (1989), for mixed motive cases under Title VII of the Civil Rights Act of 1964. Under this framework, the worker was required to prove that age "actually played a role in the employer's decision making process and had a determinative influence on the outcome." Johnson v. Mechanics and Farmers Bank, 2009 U.S. App. LEXIS 1260, p. 13 (4th Cir. 2009). The worker was required to prove this by "direct evidence that decision makers placed substantial negative reliance on an illegitimate criterion." Johnson v. Mechanics and Farmers Bank, supra, p. 14. If the worker proved these facts, then the burden of persuasion shifted to the employer to prove, as an affirmative defense, that it would have made the same decision even if it had not taken age into account. See, e.g.., Worden v. SunTrust Banks, 549 F.3d 334, 342 n.7 (4th Cir. 2008); Loveless v. John's Ford, Inc., 2007 U.S. App. LEXIS 11001 (4th Cir. 2007); Ruff v. Target Stores, Inc., 2007 U.S. App. LEXIS 5891 (4th Cir. 2007); Baquir v. Principi, 434 F.3d 733 (4th Cir. 2006); Equal Employment Opportunity Commission v. Warfiled-Rohr Casket Co., 364 F.3d 160, 163 (4th Cir. 2004).
On June 18, 2009, a sharply divided United States Supreme Court in Gross v. FBL Financial Services, Inc., No. 08–441, ruled that the burden-shifting framework adopted in Price Waterhouse does not apply to mixed motive cases under the ADEA. ADEA mixed motive cases, the Court ruled, are no different than other disparate treatment claims under the ADEA, and under all such claims the worker "must prove, by a preponderance of the evidence, that age was the 'but-for' cause of the challenged adverse employment action." Rejecting the burden-shifting framework adopted in Price Waterhouse for Title VII mixed motive claims, the Court announced that in ADEA cases "the burden of persuasion does not shift to the employer to show that it would have taken the action regardless of age, even when a plaintiff has produced some evidence that age was one motivating factor in that decision." Even in such situations, "the plaintiff retains the burden of persuasion to establish that age was the 'but-for' cause of the employer’s adverse action." Justices Stevens, Souter, Ginsberg and Bryer dissented sharply from the majority's rejection of the use of Price Waterhouse in ADEA cases and to its adoption of the but-for test.
The entire Court, on the other hand, agreed that an ADEA plaintiff is not required to produce direct evidence of discrimination in order to prove his case. The majority stated, "Because we hold that ADEA plaintiffs retain the burden of persuasion to prove all disparate-treatment claims, we do not need to address whether plaintiffs must present direct, rather than circumstantial, evidence to obtain a burden-shifting instruction. There is no heightened evidentiary requirement for ADEA plaintiffs to satisfy their burden of persuasion that age was the 'but-for' cause of their employer’s adverse action, and we will imply none." Similarly, the dissenting Justices stated that direct evidence should not be required in order for an ADEA plaintiff to shift the burden of persuasion to the employer under Price Waterhouse.
The Supreme Court's decision in Gross has extremely important litigation implications for any employer defending an ADEA claim, and especially an ADEA mixed motive claim. After Gross, an employer responding to an ADEA compliant still should plead that the same action would have been taken in the absence of any age-based consideration, but those facts should not be pleaded as an affirmative defense which the employer must prove. An employer who already has pleaded these facts as an affirmative defense should consider moving to amend its defensive pleadings to reflect the fact that the burden of persuasion has been shifted from them to the plaintiff. Jury instructions likewise should be revised to reflect Gross. And an employer with a pending motion for summary judgment in an ADEA mixed motive case should carefully review the motion to determine whether supplemental briefing or argument is appropriate in view of Gross.
While at first blush Gross appears to favor employers, and in some ways does, the case may prove helpful to some plaintiffs. Before Gross, employers could seek summary judgment based upon a plaintiff's lack of direct evidence, but that opportunity now appears to be foreclosed. Moreover, Gross may enable plaintiffs to prove ADEA mixed motive cases using circumstantial evidence alone. This means that an employer defending an ADEA case will need to increase its focus on discovering and addressing evidence which the plaintiff may offer as circumstantial evidence of discrimination.
Gross also has implications for employers outside of the litigation context. Because it appears that an ADEA plaintiff now may prevail based solely upon circumstantial evidence, employers need to be increasingly vigilant in identifying situations and events which may be misconstrued as suggesting age discrimination. At a minimum, employers should considering stepping up their investigation and documentation of circumstances which may give rise to ADEA claims, so they will be able to provide convincing explanations for potentially ambiguous circumstances.
Gross may signal a fundamental movement by the majority away from its past willingness to look to Title VII decisions as precedent for ADEA cases. Its rejection of Price Waterhouse as applicable precedent suggests that. Moreover, the Court expressly noted that "the Court has not definitively decided whether the evidentiary framework of McDonnell Douglas Corp. v. Green, 411 U. S. 792 (1973), utilized in Title VII cases is appropriate in the ADEA context." In view of this, it is fair to ask whether the McDonnell Douglas analysis used in pretext cases might soon meet the same fate in ADEA cases as was met by the Price Waterhouse analysis in Gross.
As stated above, the Supreme Court was sharply divided in Gross, with Justices Stevens, Souter, Ginsberg and Bryer expressed sharp disagreement with the majority. This means that a future change in the composition of the Court could have significant implications. And, of course, there is Congress. It would not be surprising to see legislation proposed to reverse or modify the "but for" test adopted in Gross. Human resources professionals will need to be alert to potential new developments relating to this decision.
Raymond L. Hogge, Jr. is an attorney with over 20 years experience advising and representing Virginia public and private employers on labor and employment law matters. He welcomes calls from employers, and can be reached during business hours at (757) 961-5400.