Executive Summary: A divided U.S. Court of Appeals for the Seventh Circuit, sitting en banc, recently ruled 8-4 that job applicants may not bring claims for unintentional age discrimination under the Age Discrimination in Employment Act (ADEA). In rejecting plaintiff Dale Kleber’s claim, the court chiefly relied on the text of the statute, but also supported its position by examining the overall structure of the ADEA. See Kleber v. CareFusion Corp. (7th Cir. Jan. 23, 2019).
In March 2014, Kleber applied for a senior in-house attorney position in CareFusion’s law department. Kleber was 58 when he applied and had the requisite experience. But CareFusion hired a 29-year-old applicant instead who met, but did not exceed, the posted experience requirement. Kleber sued in federal district court, claiming both disparate treatment discrimination (claiming the company intentionally refused to hire him because of his age) and disparate impact discrimination (claiming the company unintentionally discriminated against him because its hiring policies, which appeared to be neutral, had a disproportionate impact on individuals age 40 and over). The district court dismissed the disparate impact claim, and Kleber voluntarily dismissed the disparate treatment claim. Kleber appealed to the Seventh Circuit. A three-judge panel of the Seventh Circuit reversed, but subsequently granted en banc review and then affirmed the lower court’s determination that job applicants cannot bring a disparate impact claim under the ADEA.
The Seventh Circuit held that the provision of the ADEA that permits disparate impact claims, § 4(a)(2), by its plain terms does not apply to job applicants for several reasons. Section 4(a)(2) 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 an individual’s age.” The court held that by its very terms § 4(a)(2) limits its protection to employees because the impact must harm an individual with “status as an employee.” In support, the court cited the dictionary, affirming that an “applicant” has no “status as an employee.”
The court went further and examined other portions of the ADEA, confirming that job applicants are not covered under § 4(a)(2). For instance, in § 4(a)(1)—the disparate treatment portion of the statute—Congress made it unlawful for an employer “to fail or refuse to hire” an individual because of his or her age. The court held that a “side-by-side” comparison of § 4(a)(1) with § 4(a)(2) evidenced Congress’ intent because it clearly knew how to proscribe disparate treatment age discrimination claims in hiring, noting that when Congress includes language in one section but omits it from another, Congress intended a difference in meaning.
The court rejected Kleber’s other arguments and concluded by noting that § 4(a)(2) still has teeth as it prohibits disparate impact discrimination against employees. The court stated that it is up to Congress to amend the statute to include job applicants in that section's ambit.
Bottom Line for Employers: The decision narrowly applies to disparate impact claims of age discrimination under the ADEA. It is important to remember that job applicants are protected under the disparate treatment portion of the statute. There is no split among the federal appeals courts on this issue, making it an unlikely candidate for Supreme Court review, but the four judges in dissent read the statute as being vague and susceptible to an interpretation that includes job applicants. So while a decision finding disparate impact liability for job applicants under the ADEA is unlikely in the near future, we will keep you updated on any developments in this area.