The United States Supreme Court Makes Age Discrimination Claims Harder To Prove By Holding That An ADEA Plaintiff Must Prove “But-For” Causation

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Employment & Labor Law Alert

June 24, 2009

Last week, a sharply divided United States Supreme Court clarified and reduced the burden on employers in defending claims of age discrimination under the Age Discrimination in Employment Act of 1967 (“ADEA”). In Gross v. FBL Financial Services, Inc., 2009 WL 1685684 the Court held to successfully prove age discrimination a plaintiff must demonstrate by a preponderance of the evidence, that age was the “but-for” cause that led to an adverse employment action. Significantly, the Court determined that even when a plaintiff has produced some evidence that age was one motivating factor that led to an adverse employment decision (a “mixed-motives” case), the burden of persuasion will not shift to the employer to show it would have taken the action regardless of age, as the employer is required to show in a Title VII case for claims of race, color, religion, sex or national origin discrimination. Rather, the Court found that because of textual differences in the ADEA and Title VII, the burden of persuasion never shifts to the employer as it can under Title VII.

The Facts
At age 54, petitioner Jack Gross, a long term FBL Financial Services (“FBL”) employee, was reassigned from his position of claims administration director to the position of claims project coordinator. At the same time, many of Gross’ former job responsibilities were transferred to a newly created position of, claims administration manager. The new position was filled by an employee who Gross formerly supervised who was in her early forties. Gross believed that his reassignment was a demotion, and filed suit in District Court against FBL alleging he was demoted on account of his age in violation of the ADEA.

At trial, Gross presented circumstantial evidence to suggest that his demotion was based at least in part on his age, and FBL defended its decision on the grounds that it was part of a corporate restructuring and that Gross’ new position was better suited to his skills. The District Court, instructed the jury using the mixed-motive discrimination standard. Specifically, the District Court instructed the jury that it must return a verdict for Gross if he proved by a preponderance of the evidence that FBL demoted him and that his “age was motivating factor” in FBL’s decision to demote him. The District Court explained that Gross’ age would qualify as a “motivating factor if [it] played a part or role in [FBL’s] decision to demote [him].” The Court also instructed the jury that once Gross proved his age was “motivating factor,” FBL had to prove by a preponderance of the evidence that FBL would have demoted Gross regardless of his age. The jury returned a verdict in favor of Gross, and awarded him $46,945.

On appeal FBL challenged the Court’s jury instructions, and argued that the Court incorrectly instructed the jury on a mixed-motive standard, because Gross had not presented any direct evidence of discrimination. The Eighth Circuit, relying on Price Waterhouse v. Hopkins, 490 U.S. 228 (1989), reversed and remanded, holding that because Gross had not presented any direct evidence of discrimination, the District Court erred in shifting the burden of persuasion to FBL to prove it would have made the same decision regardless of age, and that the jury should have been instructed only to determine whether Gross had carried his burden of proving that age was the determining factor in FBL’s employment action. The Supreme Court granted certiorari on the question of whether a plaintiff must present direct evidence of age discrimination in order to obtain a mixed-motives jury instruction in a suit brought under the ADEA.

The Decision
Surprisingly, instead of deciding the specific issue presented by the petition for certiorari, i.e., whether a plaintiff must present direct evidence of age discrimination in order to obtain a mixed-motives jury instruction in a suit brought under the ADEA, Justice Clarence Thomas, writing for the five justice majority, held that a mixed-motives jury instruction that shifts the burden of persuasion to the employer is never proper in an ADEA case. The Court further held, that to successfully assert a claim of age discrimination under the ADEA, a plaintiff must prove by a preponderance of the evidence that age was the “but-for” cause that led to an adverse employment action. The Court based its decision on the textual differences between the language of the ADEA and Title VII.

In reaching its conclusion, the Court reasoned that unlike Title VII, the text of the ADEA does not provide that a plaintiff may establish discrimination by showing that age was simply a motivating factor in the employer’s decision. The Court found particularly significant Congress’ decision to amend the language of Title VII to explicitly provide that a plaintiff may establish discrimination by demonstrating that race, color, religion, sex or national origin was a motivating factor in the employer’s decision, and not simultaneously amending the language of the ADEA. Because of this textual difference, the Court held that its interpretation of the ADEA is not governed by its prior decisions interpreting Title VII, including Price Waterhouse and Desert Palace Inc. v. Costa, 539 U.S. 90 (2003).

After finding that its Title VII precedents were not applicable to ADEA claims, the Court focused on the specific text of the ADEA, which states that “it shall be unlawful for an employer to fail or refuse to hire or discharge any individual or otherwise discriminate against any individual …because of such individuals age.” Relying on the “because of” language, the Court held that the plain language of the ADEA requires a plaintiff prove that age was the “but-for” cause of the employer’s adverse action. Consequently, the Court explained, the burden of persuasion necessary to establish liability under the ADEA is the same in a mixed-motives case as in any other ADEA disparate-treatment claim, and remains at all times with the plaintiff.

Interestingly, in rejecting Gross’ argument that interpretation of the ADEA is controlled by the Court’s decision in Price Waterhouse, Justice Thomas opined that, “it is far from clear that the Court would have the same approach were it to consider the question today in the first instance” and that “it has became evident in the years since [Price Waterhouse] was decided that its burden-shifting framework is difficult to apply.” Thus, it appears the majority of the Supreme Court may be setting the grounds to reject the application of Price Waterhouse  to other non-Title VII discrimination claims, such as claims under the Americans with Disabilities Act.

Conclusion
Gross v. FBL Financial Services, Inc., is a significant victory for employers. The long-term impact of the ruling, however, will depend on several factors. First, it is possible Congress will move to amend the ADEA in order to negate the effects of the Court’s decision. Second, it is unclear, what effect, if any, this decision will have on age discrimination claims brought under state discrimination laws whose text does not mirror the ADEA’s. For example, the New Jersey Appellate Division has held that a mixed-motive jury instruction is appropriate in discrimination claims brought under the New Jersey Law Against Discrimination. See Myers v. AT & T, 380 N.J. Super. 443 (App. Div. 2005). So while Gross, certainly has important ramifications for age discrimination claims, as well as discrimination cases in general, only time will tell the full impact of this decision. As always, employers need to be careful when making employment decisions regarding terminations, layoffs, and discipline, and ensure all decisions are based on objective non-discriminatory factors.