This edition of Employment Flash looks at developments in labor and employment law, including with respect to restrictive covenants; new state anti-harassment laws; minimum wage increases; age bias claims; and the employee classification test and definition of concerted activity. The newsletter also examines how the U.K., France and Germany are working to close the gender pay gap.
On January 23, 2019, the U.S. Court of Appeals for the Seventh Circuit held in Kleber v. CareFusion Corporation, No. 17-1206 (7th Cir. Jan. 23, 2019), that the federal Age Discrimination in Employment Act (ADEA) does not protect outside job applicants from disparate impact age discrimination. In Kleber, a lawyer in Illinois who was 58 at the time applied for a job at a medical supply company. The applicant alleged that the company hired a less-qualified candidate who was 29 and that the job description, which required that applicants have “no more than 7 years” of relevant experience, was discriminatory against applicants who are older. The applicant argued that applicants, as well as employees, should enjoy similar protections under the ADEA as those afforded to applicants and employees under Title VII of the Civil Rights Act of 1964, a federal statute that prohibits discrimination on the basis of certain protected characteristics, such as race, color, religion and sex.
The Seventh Circuit held that the plain language of the ADEA — which, unlike Title VII, does not include the term “applicants” — makes clear that Congress did not intend to extend disparate impact protection under the ADEA to applicants. The Seventh Circuit’s decision reflects and reinforces an existing judicial split regarding this issue. The U.S. Court of Appeals for the Eleventh Circuit in Villarreal v. R.J. Reynolds Tobacco Co., 839 F.3d 958 (2016), has held that the ADEA does not provide a basis for an applicant to make a successful disparate impact claim because an applicant is not an “employee” under the statute. Notably, in Villarreal, the Equal Employment Opportunity Commission filed an amicus brief supporting the position that the ADEA provides a statutory basis for applicants to bring claims of age-based disparate impact in hiring. However, in Rabin v. PricewaterhouseCoopers LLP, 236 F.Supp.3d 1126 (N.D. Cal. 2017), a federal district court in the U.S. Court of Appeals for the Ninth Circuit held that disparate impact claims under the ADEA are not limited to employees. In addition, in Champlin v. Manpower Inc., No. 4:16-CV-00421 (S.D. Tex. Jan. 24, 2018), a federal district court in the U.S. Court of Appeals for the Fifth Circuit held that absent binding authority on the language in the ADEA, it would not dismiss an applicant’s disparate claim under the ADEA. It remains to be seen whether and how other federal courts and the U.S. Supreme Court will address this issue going forward.