When employers are held liable for discrimination in a reduction in force, the liability is all too often the result of, not illegal bias, but rather, poor decision-making procedures, sloppy documentation and inattention to detail. In a RIF, the employer's objectives should be not only (a) to follow a structured system for selecting those persons to be released, but (b) to create documents and records confirming the employer's non-discriminatory use of the structured system. An employer's failure to do the latter often subverts its performance of the former. A recent decision from the U.S. District Court for the Eastern District of Michigan illustrates this. Dibble v. Security Corp., Civil Case No. 09-CV-13314 (E.D. Jan. 5, 2011).
Dibble, a Service Technician, age 64, was laid-off when his employer lost a major customer account valued at approximately $200,000 per year in revenue. Two managers selected Dibble for layoff, but they had no plan for carrying out the RIF and kept no records about the criteria used to evaluate the Service Technicians, how they weighed the evaluation criteria, or how the Service Technicians were assessed under those criteria. It was not even clear, from the evidence, that the managers uniformly applied the same criteria to all the Service Technicians.
At the time of Dibble's layoff and continuing during the case, the company offered shifting justifications for selecting him for the RIF - observing that the workload for Service Technicians was unevenly distributed and the customer demand for Dibble was much less than that for two colleagues in an adjacent region. The company also expressed that one of the two colleagues had more training than Dibble on certain job functions, criticized Dibble's inability to get along with fellow employees and reassigned Dibble's work to the two colleagues in the adjacent region.
The Court held that Dibble presented substantial evidence from which a jury could find the employer's explanations for terminating Dibble a pretext for age discrimination.
For instance, the Court held that pretext could be found because the company did not have "a plan for carrying out its reduction in force." One manager testified that the selection decisions were based on "gut instinct" - and there was "no way of tracing the decision-making process." A systematic analysis of all the Service Technicians, with accompanying documentation, could have precluded this concern.
The Court also found that pretext could be inferred from the Company's shifting rationale for terminating Dibble. If the employer had devised a clear explanation for the layoff from the very start, it could have later reiterated the explanation in various forums, without creating an impression of inconsistency. By allowing the explanations to evolve over time, and by stating them differently at each stage, the employer created an appearance of pretext.
The Court also rejected many of the Company's explanations for dismissing Dibble as illogical. For example, the managers relied on a written warning issued in 2005 to criticize Dibble's work relationships with other persons, even though subsequent performance evaluations praised Dibble's ability to work with others, calling him "a strong team player and ideal technician. . . ." If the managers had bothered to look at Dibble's recent evaluations, their criticism of Dibble for the 2005 episode could have been disregarded. But, having included it in the list of justifications for Dibble's layoff, the employer could not later disavow it as a factor in the decision.
Further, the Company's dissatisfactions with Dibble's declining workload were undercut by the fact that his employer had directed him to relinquish some of his work for reassignment to the very colleagues who were retained. In other words, to the extent Dibble was criticized for a light workload, the Company may have been at fault.
Similarly, the Court found pretext in the Company's observation that another Service Technician had more training than did Dibble, when Dibble contended that the Company had discriminatorily refused his requests for such training, in favor of one of his retained colleagues.