"We’ve got an older poor performer? We can just include him in a RIF… right?"

Managers and human resources personnel sometimes hear this question when a poorly performing employee is in a protected group but the poor performance is not well-documented. The temptation to include a poorly performing protected status employee in a reduction in force (RIF) as a means of avoiding or minimizing the risk of potential liability should be closely scrutinized before proceeding.

Consider this recent example from Kentucky that illustrates what can happen when decision makers include managers who have made discriminatory comments that are not reported.

An employer in Eastern Kentucky decided to reduce the size of its retail sales force. Retail sales employees were directly supervised by District Managers, who were supervised by Zone Managers. Without being given any explanation for it, all Zone Managers were summoned to Chicago for a meeting held to evaluate the entire sales force.

Before this meeting, human resources personnel had decided how to evaluate and compare the job performance of all sales employees. The Zone Managers were instructed to rely on employee "scorecards" that contained objective information and on their own personal experiences with the sales employees. After this information was collected, human resources personnel created geographic "pools" of sales representatives for comparison purposes. The sales employee with the lowest assessment in each pool was discharged as part of a general reduction-in-force that occurred a few months later.

One of the discharged sales employees was over 60 years old and had 34 years of experience with the Company at the time of his termination of employment. The sales employee sued the Company claiming that he had been discriminated against on the basis of his age, among other claims. A federal trial judge recently denied the employer's motion for summary judgment (to dismiss the case without a trial) on the age discrimination claims, which means that a jury must decide if age was at least a "motivating factor" in the employer's action.

How Did This Happen?

The summer before the sales employee had been discharged, his immediate supervisor, a District Manager, was being evaluated by the Zone Manager. During his evaluation, the District Manager made positive comments about the sales employee. In response, the Zone Manager said, "[Sales Employee] is too old and set in his ways to make the changes necessary. We need to, more or less, move in different directions."

The District Manager was so shocked by this comment that he repeated it to others at the time. The sales employee did not, however, know of it at the time and only learned of it about eight months later, one month before he was informed that his employment was being terminated.

Why Was A Trial Necessary?

Discrimination may be proven with either direct or indirect evidence. Direct evidence of discrimination are facts which, if believed, require the conclusion that unlawful discrimination was at least a motivating factor in the employer's action.

In general, the Sixth Circuit Court of Appeals (which includes cases from Kentucky and Ohio) has held that some age–related comments are inadmissible if they are "too abstract," e.g., statements that young people are taking over or which reflect negative views of "old timers." Similarly, statements by non-decision makers do not satisfy the required burden of proof. On the other hand, statements by those who are "meaningfully involved" in the decision to terminate must be considered.

The trial judge found that the Zone Manager's comment was not ambiguous and clearly suggested a negative view of the sales employee's age. In addition, the comment directly concerned the sales employee and the adverse action taken against him.

Even though the Zone Manager was not the decision-maker, the Court found that he "contributed significantly" because Human Resources relied entirely on his rating of the sales employee in deciding to discharge him. Also, even though the allegedly biased remarks occurred more than six months before the adverse action, the fact that the remarks were unambiguous and asserted by someone who "contributed significantly" to the termination decision meant a jury was necessary to decide if the termination was illegally motivated by age discrimination.

How Could This Have Been Avoided?

According to the District Court judge, the employer could have relied on evaluations of others, not just the one evaluation of the Zone Manager, and made sure objective criteria had been the determining factor in choosing those to discharge. Even if the Zone Manager's opinion had only been part of the process, an independent assessment of all criteria would have made the one manager's evaluation insignificant to the ultimate decision.

This case highlights the importance of seeking employment legal counsel to assist in crafting or reviewing a valid reduction in force process before and during the reduction-in-force to ensure there is minimal risk of discrimination claims. In short, adverse action against employees who are in protected groups can be accomplished with minimal potential risk. Understanding the factors that would reflect a legitimate, non-discriminatory decision-making process is essential before taking adverse employment actions.