In another important victory for employers, a sharply divided Supreme Court ruled late last week, in Gross v. FBL Financial Services, Inc., that plaintiffs bringing “mixed motive” discrimination claims under the Age Discrimination in Employment Act (“ADEA”) must prove, by a preponderance of the evidence, that age was the “but-for” cause of the challenged adverse employment action. The Court rejected as inapplicable to ADEA claims the burden-shifting framework it had established for Title VII mixed motive cases twenty years earlier in Price Waterhouse v. Hopkins, 490 U.S. 228 (1989). Under that framework, a plaintiff need only show that the impermissible consideration (i.e., race, sex, national origin, etc.) was a “motivating” or “substantial” factor in the employer’s action. Upon such a showing, the burden of persuasion shifts to the employer to prove that the same action would have been taken in the absence of the impermissible consideration. In Gross, the Court held that the burden of persuasion never leaves the plaintiff in an ADEA case. The Court’s decision makes it more difficult for plaintiffs to prove age discrimination in cases where the employer’s action was influenced to some degree by both permissible and impermissible factors.
The plaintiff in Gross was a claims administration director who had worked for the company for 22 years. In 2003, when he was 54 years old, the company changed his title to claims project coordinator and reassigned some of his duties to another employee in her early forties who plaintiff had formerly supervised. The company did not reduce plaintiff’s compensation; nevertheless, he viewed the change in title and reassignment of duties as a demotion and filed suit under the ADEA. At trial, plaintiff introduced evidence suggesting that his reassignment was motivated at least in part by his age. The company presented evidence that the reassignment was part of a larger corporate restructuring and that plaintiff’s skills were better suited to the new position.
At the close of trial, over the company’s objection, the court instructed the jury that it must find for the plaintiff if it determined that he had proven by a preponderance of the evidence that age was a motivating factor in the company’s decision to demote him. The court further instructed that the plaintiff’s age was a motivating factor if it “played a part or role” in the company’s decision. Finally, the court instructed the jury that it must find for the company if it determined that the company had proven by a preponderance of the evidence that it would have demoted the plaintiff regardless of his age.
The jury returned a verdict for the plaintiff and the company appealed the case to the U.S. Court of Appeals for the Eighth Circuit. The issue on appeal was not whether the mixed motive burden-shifting approach applied to ADEA cases; both parties assumed that it did. The issue was whether, under Price Waterhouse, the plaintiff was required to present direct evidence (as opposed to circumstantial evidence) that age was a motivating factor in the demotion decision before the burden of proof could be shifted to the company. The Court of Appeals found that direct evidence was required and, because the plaintiff conceded he had no direct evidence, a mixed motive jury instruction should not have been given.
The Supreme Court granted certiorari based on the issue that had been presented to the Eighth Circuit, namely: “whether a plaintiff must present direct evidence of discrimination in order to obtain a mixed motive instruction in a non-Title VII discrimination case.” The Court never reached that issue, however, because it determined, in a 5-4 decision, that the burden of proof never shifts to the party defending an alleged mixed motive discrimination claim under the ADEA. The majority rested its holding on the fact that, following Price Waterhouse, Congress amended Title VII in 1991 to incorporate the mixed motive burden-shifting framework set out in by the Court in Price Waterhouse, but did not incorporate the same amendments into the ADEA even though it amended other parts of the ADEA. The Court saw this as a clear indication that Congress did not intend for the burden-shifting approach to apply to ADEA cases. The Court went on to hold that the ADEA prohibits discrimination “because of [an] individual’s age” which is simply another way of saying that “but-for” causation must be shown (despite the fact that the Court, in Price Waterhouse, had rejected that interpretation of identical language in Title VII). Thus, an ADEA plaintiff must prove that age was “the reason” the employer decided to act. The Court also took the opportunity to opine on the difficulties the lower courts have had in applying the mixed motive burden-shifting framework and cited these difficulties as an additional reason for not extending it.
In a very sharply worded dissent, Justice Stevens accused the majority of “unnecessary lawmaking” and of an “utter disregard of our precedent”. He further objected that the “but-for” causation standard adopted by the majority had been specifically rejected by the Court in Price Waterhouse and by Congress when it amended Title VII in 1991. Justice Breyer, writing separately, agreed and noted that the but-for causation standard is particularly ill-suited for discrimination cases that turn on an employer’s motive, most often a subjective inquiry, as opposed to personal injury cases that turn on physical causation, a more objective inquiry.
The Gross decision is a significant win for employers. Coming at a time when many companies are being forced to reorganize, reduce staff or engage in deep cost-cutting, the decision undoubtedly makes it more difficult for plaintiffs to prove age discrimination. The decision also underscores the deep division that exists within the current Court regarding its interpretation of the federal discrimination laws. One question that remains, however, is whether the employer’s victory will be short-lived. As it did earlier this year with passage of the Lilly Ledbetter Fair Pay Act, Congress has shown a remarkable ability in the employment law area to swiftly overturn Supreme Court rulings with which it disagrees. In fact, immediately after the Gross decision issued, Sen. Patrick Leahy (D-Vt.) compared the decision to what he viewed as “the Court’s wrong-headed ruling in [the Ledbetter case].” This reaction has caused many to predict that Congress will act quickly to overturn Gross. Nevertheless, for now, the decision will have an immediate and favorable impact on employers’ ability to defend ADEA lawsuits because plaintiffs will no longer be able to shift the burden of proof to the employer merely by showing that age was one of several motivating factors.