Supreme Court Sets Higher Burden for Plaintiffs in Age Discrimination Claims

07/09/2009 / Julia H. Halbach and Paul M. Haverstock*

On June 18, 2009, the United States Supreme Court issued its decision in Gross v. FBL Financial Services Inc. In a 5-to-4 decision, the Supreme Court held that, under the Age Discrimination in Employment Act (“ADEA”), an employee must prove that age was the cause of the employer’s discriminatory treatment, and not merely one motivating factor. The Court also stated that, unlike in Title VII cases, the burden of proof never shifts to the employer in age discrimination claims under the ADEA.

Facts of the case: Jack Gross was an employee of FBL Financial Services. FBL reassigned him to the position of “claims project coordinator,” which he viewed as a demotion. At the same time, FBL assigned a younger, and arguably less qualified employee, to a promotional position. Gross, who was 53 years old at the time, sued FBL for age discrimination under the ADEA, claiming that FBL had demoted him due to his age. During the trial, Gross presented circumstantial evidence that he was more qualified for the promotional position than the younger employee, and that FBL had been dishonest about its reasons for promoting the younger employee instead of Gross. The jury awarded Gross nearly $50,000 in lost compensation due to his demotion.

FBL appealed and the Eighth Circuit Court of Appeals reversed and sent the case back to the district court for a new trial. The Court found that the lower court had wrongly given a jury instruction on mixed-motive employment actions, which occur when an employer has more than one reason for its action. The Eighth Circuit concluded that, before a mixed-motive instruction can be given, an employee must present direct evidence of age discrimination, such as a comment or document demonstrating that the employer acted because of the employee’s age. In this case, Gross had not presented any direct evidence that the employer took the action it did because of Gross’ age.

Legal Analysis: Courts had been split on whether direct evidence of discrimination is required to shift the burden of proof from the employee to the employer in mixed-motive cases. The split arose from competing interpretations of Price Waterhouse v. Hopkins, a 1989 United States Supreme Court case. In Price Waterhouse, the Court addressed the allocation of the burden of proof in Title VII cases. The Court held that if the plaintiff shows discrimination was a “motivating factor” in the employer’s decision, the burden shifts to the employer to prove that it would have taken the same action regardless of the discriminatory consideration. In applying Price Waterhouse, six circuits had concluded that direct evidence of discrimination was not required for a mixed-motive instruction, while three circuits, including the Eighth, had concluded that direct evidence was required.

In this case, the United States Supreme Court resolved the split by finding that under the ADEA, the burden of proof never shifts to the employer, even if the employee has provided circumstantial evidence that age was a motivating factor in the employer’s decision. Justice Thomas explained that the standard of proof in Title VII cases is lower than the standard in ADEA cases. Title VII requires an improper consideration to have been merely a “motivating factor,” whereas the ADEA requires age to have been the reason for the employer’s decision.

What this case means for employers: The Court’s ruling protects employers by clearly placing the burden of proof on the plaintiff in age discrimination lawsuits. Additionally, the Court specified that a plaintiff must prove that age was the factor for the employer’s disputed decision, not merely a factor in the decision. If a plaintiff cannot provide direct evidence that the employer acted based on his or her age, their case may be dismissed.

This case means that employers may not be held liable for taking age into account when making non-discriminatory employment decisions, unless the evidence shows that they made their decision because of the employee’s age. Employers will have more freedom to make decisions without having to ignore common sense considerations that naturally correspond to age. Nonetheless, this decision does not give employers immunity against age discrimination claims, and employers should weigh such decisions based on age carefully. The attorneys in Larkin Hoffman’s Labor & Employment Group have substantial experience in these matters and are able to assist with any issues relating to this case, or any other labor or employment questions your company might have.

*Mr. Haverstock is a 2009 Summer Law Clerk at Larkin Hoffman Law Firm.