The right way to use subjective criteria in layoffs

Reductions-in-force present a unique issue for an employer defending its decision in a subsequent discrimination case. The employer already has its legitimate, non-discriminatory reason baked into the termination—the economics of a layoff, which often causes qualified employees to lose their jobs. For this reason, reduction-in-force cases are often singularly focused on the issue of pretext.

In Beck v. Buckeye Pipeline Services Co. (6th Cir. 9/28/12) [pdf], the plaintiff claimed that the employer’s use of subjective criteria to select her for inclusion in the layoff created an inference that the employer singled her out because of her age or gender.

While agreeing the subjective decision-making can prove problematic in some cases, the court disagreed that its use is per se discriminatory.

Subjective criteria, it is true, sometimes make it difficult to distinguish between lawful and unlawful employment actions, and they deserve careful scrutiny…. When all is said and done, the use of subjective evaluation criteria does not by itself show discrimination, particularly in a reduction in force case. 

What factors did the court rely upon to conclude that this employer’s use of subjective criteria in this layoff did not create an inference of discrimination?

• There was no evidence that a disproportionately high rate of women or older workers were included in the layoff.
• There was no evidence that the employer’s use of subjective evaluation procedures was a deviation from its normal decision-making process.
• There was no evidence of dishonesty in the subjective decision-making process.

What lessons does this case teach hold for employers considering the use of subjective criteria in determining which employees to include in a workforce reduction?

1. What do your workforce demographics look like before and after the RIF, company-wide, department by department, and job function by job function? If it looks like your RIF affected women, minorities, or older workers more than their comparators, it will become harder to justify the legitimacy of the subjective criteria.
2. Do you always use subjective criteria as part of your decision-making? If not, it will look like you added a subjective component to this RIF for a reason (to single out someone or some group). If nothing else, you will have to explain why you deviated from the norm, an explanation that may be enough for the employee to survive summary judgment and get his or her case to a jury.
3. Was everyone honest in their subjective evaluations? The quickest way to buy yourself a jury trial is for the plaintiff to uncover dishonesty or other shenanigans in the decision-making process. If you are going to have a subjective component to any RIF, make sure the evaluations pass muster. How do they compare to past performance reviews? Have the employees ever been counseled, disciplined, or put on a performance plan? Are their objective criteria (sales numbers, for example) that could contradict a subjective evaluation? 

Bag of Bones = age discrimination

Stephen King’s Bag of Bones is about an author who moves to a lakeside house to confront his nightmare in the wake of his pregnant wife’s death. EEOC v. Hawaii Healthcare Professionals, Inc., concerns a nightmare of a different kind.

In 2008, Hawaii Healthcare’s owner, Carolyn Frutoz-De Harne, ordered the firing of then 54-year-old Debra Moreno. Frutoz-De Harne proceeded with the termination over the protest of the facility manager, who hired and supervised Moreno, and who thought she was a thorough and efficient worker. In ordering the termination, Frutoz-De Harne allegedly told the manager that Moreno “looks old,” “sounds old on the telephone,” and is “like a bag of bones.” After the termination, the manager reported the ageist comments to Moreno, who in turn filed an age discrimination charge with the EEOC. The agency subsequently filed a lawsuit on Moreno’s behalf.

Last week, a federal court ordered Hawaii Healthcare Professionals to pay Moreno $193,236 for the discrimination. According to the EEOC:

Age should never be a factor when evaluating an employee or job applicant’s worth. What makes this case especially appalling is the flagrant disregard for a worker’s abilities, coupled with disparaging ageist remarks and thinking.

Procedurally, this case is unique because the district court entered a default judgment against Hawaii Healthcare after it failed to respond to the EEOC’s amended complaint. Even if this case proceeded to trial, however, Hawaii Healthcare would have faced an uphill battle. An executive terminating an employee over a manager’s objections and after referring to the fired employee as “bag of bones”? Sounds to me like a tough age case to defend.

Did the 6th Circuit just approve a claim for benign discrimination?

In Litton v. Talawanda Sch. Dist. (6th Cir. 6/26/12) [pdf], a demoted and transferred custodian sued his employer for age and race discrimination. At trial, the jury returned the following special verdict:

The jury concluded that Litton did not prove that he had suffered an adverse action, yet proved that he was treated differently because of his race. Under the McDonnell Douglas burden-shifting framework, the lack of an adverse action should dispose of the case. If one cannot show a prima facie case (which includes the suffering of an adverse action), the ultimate issue of discrimination should never be reached.

The 6th Circuit, however, disagreed. It disregarded the jury’s finding on the existence of an adverse action as irrelevant to its subsequent finding on the ultimate issue of whether discrimination occurred:

The jury’s assessment of Litton’s prima facie case did not control its finding on the ultimate question of discrimination…. he district court was not only permitted to disregard the jury’s answer to the adverse employment action question, it was required to do so, and instead to evaluate the strength of the evidence as a whole.

As I read the opinion in Litton, I mapped out in my head a grand critique. Then I read Judge Batchelder’s dissent, and decided I couldn’t say it any better:

The core problem with the majority’s holding is that it treats the question of whether Litton suffered adverse discrimination as distinct from “the ultimate question of discrimination vel non.” The two are one…. Title VII does not ban mere discrimination, but only adverse discrimination…. It is, to me, beyond obvious that Title VII applies only where there has been discrimination against an individual. That requirement is not merely some vestigial prima facie element that fades into the background as the case progresses—it is at the heart of the claim itself….

In sum, “the ultimate burden of persuading the trier of fact that the defendant intentionally discriminated against the plaintiff remains at all times with the plaintiff.” … The majority should not relieve Litton of his burden, and it certainly should not grant him victory in the face of a jury verdict finding that he never proved that he suffered adverse discrimination at all. The whole purpose of Title VII … is preventing harmful discrimination, not the lamentable-but-benign discrimination that the jury found Litton experienced.

Did the 6th Circuit unwittingly create a cause of action for benign discrimination? Or, is this case an anomaly that future courts will distinguish and disregard? Common sense mandates the latter. Right?

The word of the day is “systemic”

The EEOC has published its draft strategic plan for fiscal years 2012 – 2016. A quick Ctrl-F for the word “systemic” reveals 16 different hits in this relatively short document.

“Systemic” cases, according to the EEOC, are those that “address a pattern, practice or policy of alleged discrimination and/or class cases where the alleged discrimination has a broad impact on an industry, profession, company, or geographic area.” The identification, investigation, and litigation of this category of cases remains a “top priority” of the agency. When the EEOC publishes the final version of its strategic plan, expect to see a target percentage of systemic cases in the agency’s litigation pipeline.

What does this mean for employers? It means that company-wide policies that have the potential affect certain groups more than others very much remain on the EEOC’s enforcement radar. What are some of these issues for employers to heed:

• Arrest and conviction records
• Work-life balance and the plight of working moms
• Religious accommodations and “look” policies
• Leave of absence policies
• Credit histories
• Employment status 
• Age 

Keep an eye on these issues, because you can bet the EEOC will be (at least for the foreseeable future).

“May” I have another (lawsuit)? One word sinks employer’s efforts to force arbitration

It’s no secret that I’m not a fan of arbitration of employment disputes. Conventional wisdom says that binding arbitration keeps down costs and speeds up resolutions. I’ve yet to be convinced. Many employers, though, continue to drink the arbitration Kool-Aid by requiring employees sign alternative dispute resolution agreements as part of their employment. Sherwin-Williams appears to be one of them. Its choice of one key word in its Problem Resolution Procedures, however, cost the paint company its chance to litigate an ex-employee’s age discrimination claim in its forum of choice.

The word at issue in Hyde v. Sherwin-Williams Co. (8/25/11) [pdf] is “may.” Sherwin-Williams’s Problem Resolution Procedures provide:

These procedures may be used by employees to challenge the unresolved differences regarding application of Company policies, procedures or practices which affect their employment situation. These procedures are intended to be an exclusive, final and binding method to resolve all covered claims to the fullest extent permitted by law. Failure to use these procedures may preclude employees from pursuing any other legal right they may have in court or in other forums.

An Ohio appellate court concluded that the use of the word “may” disposed of Sherwin-Williams’s attempt to force an ex-employee to litigate his age discrimination claim in court:

We find that Sherwin-Williams’ repeated representations that an employee’s failure to follow the PRP “may” preclude that employee from seeking redress in outside forums expressly contradicts appellants’ position that the procedures outlined in the PRP are the exclusive method for resolving employee disputes. By virtue of the language used … appellants implied that there would be circumstances where an employee would not be prevented from pursuing resolution of their legal claims in outside forums, i.e., that the PRP procedures are not mandatory, final, or binding.

What’s worse for Sherwin-Williams is that 8 years ago another panel of the same appellate court reached the same conclusion about the same language in a prior version of the same PRP.

What’s the takeaway from this case for employers? In drafting agreements and policies, words matter. If you mean “must,” say it. Don’t say “may” (especially when a court has already told you that “may” doesn’t pass muster).

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Written by Jon Hyman, a partner in the Labor & Employment group of Kohrman Jackson & Krantz. For more information, contact Jon at (216) 736-7226 or jth@kjk.com.

Why people hate lawyers

Suppose you apply for a job. The job has certain dress code requirements for all employees. You, however, think the mandatory clothing will look unflattering on your over-40-year-old body. Do you…

1. Look for a different job?
2. Apply anyway and deal with the requirements?
3. Sue for age discrimination?

If you’re most people, you choose either of the first two options. If you’re attorney Roy Lester, however, you opt for number three.

When the New York Office of Parks, Recreation, and Historic Preservation refused to hire 58-year-old Lester as a lifeguard, he sued, claiming age discrimination. The lawyer-by-day claims that the job requirement that he wear certain swimwear discriminates against him because of his age. From CNN.com:

The rule, still in operation, requires that to be re-hired as a lifeguard, participants must wear either “boxers, briefs or board shorts” when completing a qualifying swim test…. Lester who believes that “as you age you should show less skin” prefers jammers; tight lycra shorts that end a couple of inches above the knee. The bankruptcy attorney claims “Speedos are not appropriate for a 61-year-old” and refused to wear loose-fitting shorts because they would slow him down.

According to the Wall Street Journal’s Law Blog, “Peter Brancato, spokesman for New York state’s Office of Parks, Recreation and Historic Preservation, [said] that there never was a policy specifically requiring lifeguards to wear Speedos. For the annual swim test, lifeguards are required to wear regular work gear, which for men could be a Speedo, a boxer-type swimsuit or a board suit.”

In other words, the employer subjected Lester to the same dress code as every other employee and applicant. Guess what? That’s not age discrimination, even according to the EEOC: “In general, an employer may establish a dress code which applies to all employees or employees within certain job categories.” Exceptions include dress codes that conflict with an employee’s religious practice or disability. The law makes no such exception, however, for an employee’s age.

(An appellate court just reinstated Lester’s claim, following a dismissal by the trial court. That fact does not make me think his claim is any less ridiculous).

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Written by Jon Hyman, a partner in the Labor & Employment group of Kohrman Jackson & Krantz. For more information, contact Jon at (216) 736-7226 or jth@kjk.com.

Are businesses really asking for age on employment applications?

I came across an article yesterday on The Huffington Post which says that many large retailers are requiring job applicants to disclose their ages as part of the application process. Are businesses really asking for age on employment applications?

While there’s nothing per se illegal about asking for age on a job application, why ask for certain information that’s illegal to consider? Simply, you should not ask for age, or for any information that suggests age: date of birth, year of high school or college graduation, or anticipated retirement age. The only age-related questions you should ask on job application is whether the applicant is age 18 or over and eligible to work. Anything more crosses the line, and will help a rejected candidate create an inference of discrimination. Why take that risk?

For more information on illegal questions during the hiring process, see Avoid hidden interviewing traps.

Do you want to know if your job application and other hiring processes are legal? Consider KJK’s proprietary (and free) HR and employment law audit.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus. For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

The Internet is a dangerous place for human resources

The Internet is a fabulous resource for businesses. For example, I could conduct a Google search for “social media policy” and fine some wonderful results, including an online database of 164 real-world examples. Because of the Internet’s easy access to information, it creates a strong temptation for businesses to do-it-themselves when it comes to policies and forms.

Not all websites, however, are created equal. Just because you find something on the Internet does not mean that its legal. Take, for example, Pre Employment Medical Questionnaire, which has at least 8 different questions that violate the ADA:

• Do you smoke?
• Do you drink alcohol?
• Are you under any medication?
• Are you under any medical supervision?
• Have you ever suffered from an ailment that resulted in an absence from work?
• Please indicate the total number of sick days you took out in the past year?
• Have you ever been admitted in hospital?
• Do you suffer from any medical condition that could hamper your sight, hearing, coordination or other sensory ability?

(For good measure, it also asks for employees’ dates of birth, which would constitute unlawful age discrimination, and height and weight, which could have a disparate impact based on sex).

The website says, “During the recruitment process most companies require to find out the medical history of all prospective employees.” Trust me, the only companies that ask for this information from prospective employees are those that want to find themselves on the losing end of a disability discrimination lawsuit. When searching the Internet for DIY policies and forms, do yourself and your business a favor and run them by employment counsel before using them. One 15 minute consultation could save you years in court and hundreds of thousands of dollars in legal bills.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus. For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

Ohio just became a friendlier state for age discrimination plaintiffs

In Gross v. FBL Financial Servs., the U.S. Supreme Court concluded that mixed-motives do not exist in federal age discrimination claims, and for a plaintiff to succeed on an disparate treatment claim under the ADEA, he or she must prove that age was the “but-for” (that is, the only) cause of the challenged adverse employment action.

An open question left in the wake of Gross was whether state courts such as Ohio would follow Gross under parallel state court age discrimination statutes. Thomas v. Columbia Sussex Corp. (Ohio Ct. App. 1/6/11) [pdf] provided our first Ohio answer. It concluded that Gross does not apply under Ohio’s age discrimination statute. While the opinion somewhat muddles its discussion of Gross, the court approved what amounted to a mixed-motive jury instruction given to the jury. Therefore, mixed-motive age claims are alive and well under Ohio age discrimination statute, and the effect of Gross is limited to cases brought under the federal ADEA.

For employers, this opinion is not quite as bad as it seems. Yes, it will likely result in more plaintiffs eschewing a federal venue and filing their age claims under Ohio law, and in Ohio courts with state court juries. Ohio’s age discrimination statute, however, has a short six-month statute of limitations, as compared to 300 days one has to file an age claim with the EEOC to perfect one’s right to file a lawsuit under the federal statute. Because employees have a easier burden of proof under Ohio law, they will have to elect the shortened filing period. Employees who miss the initial six months will have to go the federal route, with its tightened burden of proof under Gross.

For businesses, the advice I gave after Gross holds true regardless of the burden of proof. Employers should meticulously document employees’ performance problems and other disciplinary action. A contemporaneously well-documented personnel file makes it that much more difficult for a plaintiff to prove that age was the motivating reason behind the termination or other adverse action.

EEOC poised to explore plight of older workers in current economy

Last Wednesday, the EEOC heard testimony that age discrimination is causing older workers to have a difficult time maintaining and finding new employment. The EEOC believes that the current economic climate is exacerbating this problem. At a minimum, it is increasing the number of employees who claim to be victims of age discrimination. Last year, the EEOC received 22,778 charges of age discrimination, which represented 24.4% of all charges filed, up from 16,548 charges and 21.8% in 2006.

The EEOC heard the following testimony:

• William E. Spriggs, Ph.D., Assistant Secretary for Policy, U.S. Department of Labor: “[D]uring a deep and long recession, the lengths of time that people remain unemployed increases. Older workers have been overwhelmed in this current recession and their numbers are high among the worst indicators. They are the slowest to be reintegrated from unemployment to employment, which indicates that their job search is longer and more challenging. This comes at the cost of human capital depreciation for older workers.”

• Mary Anne Sedey, plaintiff-side employment lawyer: She claimed that older workers rarely litigate discriminatory hiring claims, and urged the EEOC to investigate age discrimination in hiring. She cited three reasons: applicants lack information about why they were turned down, they are reluctant to file a claim based on a hunch, and they cannot find lawyers willing to take their claims.

• Michael Foreman, Director, Civil Rights Appellate Clinic, Pennsylvania State University Dickinson School of Law: He discussed the impact of Gross v. FBL Financial Services, Inc., which held that the ADEA requires a plaintiff to show that his or her age was the “but-for” cause of the employment decision. He argued that Gross applies an unreasonably high burden for plaintiffs in age cases, “preventing potentially legitimate claims of discrimination from ever reaching a jury.”

• Deborah Russell, Director of Workforce Issues in AARP’s Education and Outreach Department: She discussed some proactive steps employers in the healthcare industry have taken to meet the needs of the over-50 demographic.

• Cornelia Gamlem, Society for Human Resource Management: She discussed some suggested best practices for recruiting, retaining, and managing mature workers, including workplace flexibility, retention programs, targeted recruitment, and reductions in force management.

EEOC Commissioner Stuart J. Ishimaru said, “The treatment of older workers is a matter of grave concern for the Commission. We must be vigilant that employers do not use the current economy as an excuse for discrimination against older workers.” Going forward, it is clear that the EEOC will target age discrimination as an enforcement priority. Any company that is either reducing ranks via layoffs, or hiring to re-staff as the economy rebounds, should pay extra attention to age discrimination issues in light of this administrative enforcement.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus. For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

Three steps to avoid a discriminatory hiring claim

Bartlett v. Gates (6th Cir. 11/16/10) [pdf] involved a plaintiff who claimed that he was passed over for a promotion because of his age and sex. The 6th Circuit Court of Appeals reversed a district court’s dismissal of the discrimination claims for the following three reasons:

1. The plaintiff was objectively as qualified as, if not more qualified than, the successful candidate. He had 24 years of experience as compared to eight. In addition, he possessed superior educational credentials, including a bachelor’s degree, whereas the successful candidate had not graduated from college. There was also some evidence of superior communication skills and job-specific work experience.

2. The hiring manager had not conducted any job interviews and lacked basic knowledge about the successful candidate. Despite the employer’s explanation that it had hired the best-qualified candidate for the position, the hiring manager was unable to describe her credentials. The hiring manager testified that she was able to making a hiring decision without holding any interviews because of her personal knowledge and familiarity with the job applicants’ experience, backgrounds, and competency. Yet, she did not know whether the successful candidate even had a prior experience related to the core functions of the job.

3. There was some direct evidence of discriminatory animus. The plaintiff’s supervisor and hiring manager made comments to and about the plaintiff such as informing him that his 34 years on the job were “enough,” joking about whether he had taken up “antiquing or traveling or something like that,” and suggesting that the plaintiff should retire.

What lessons can employers take away from this case to avoid a discriminatory hiring claim? Here’s three:

1. If you are not going to hire the most qualified person, at least know what you are getting yourself into. Perform a comparison of candidates, including their qualifications, relevant experience, and key demographics. Have objectively supportable reasons why you chose the 29-year-old over the 53-year-old.

2. Meet the candidates. When you whittle the field down to the final few, meet and interview them. Do not rely solely on paper. If you know the candidates, do not rely solely on past experience. Talk to them, avoid illegal questions, and form reasoned, objectively supportable pros and cons for each.

3. Finally, if you feel the need to make racial, sexist, or ageist comments in the months before and after a hiring decision, wait until you get home, make sure all your doors and windows are closed, and yell them into a pillow.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus. For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

Silence can be golden in defending discrimination cases

Ben Franklin once said, “As we must account for every idle word, so must we account for every idle silence.” In Young v. Galion, LLC (N.D. Ohio 9/17/10) [pdf] the court latched onto the plaintiff’s silence dismissing his age discrimination claim:

[T]he major flaw in plaintiff’s case is his inability to provide any evidence of a nexus between his termination and any discriminatory motive. He made no protest to that effect to the defendant, and never mentioned it in conversations with a fellow employee with whom he had a close relationship. Plaintiff’s deposition testimony was clear as regards the fact that he had no inkling that age bias purportedly entered into the decision to discipline or terminate him prior to meeting with an attorney subsequent to his termination.

One of the things I look for in defending any discrimination case is whether the employee complained of discrimination during his or her employment. While it is not required that one complained it certainly makes the claim of discrimination appear less believable if the plaintiff never raised the issue with anyone until the filing of the lawsuit.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus. For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

Does rampant age discrimination in this job environment make sense?

Motoko Rich writes in the New York Times that older unemployed workers may never work again:

Of the 14.9 million unemployed, more than 2.2 million are 55 or older. Nearly half of them have been unemployed six months or longer, according to the Labor Department. The unemployment rate in the group—7.3 percent—is at a record, more than double what it was at the beginning of the latest recession.

After other recent downturns, older people who lost jobs fretted about how long it would take to return to the work force and worried that they might never recover their former incomes. But today, because it will take years to absorb the giant pool of unemployed at the economy’s recent pace, many of these older people may simply age out of the labor force before their luck changes.

I cannot accept an argument that businesses do not desire older workers. Conventionally, a business might choose to hire young because of a belief that a more experienced candidate would demand a higher salary. Thus, even though a younger hire would require more in the way of sunk costs (training, etc.), he or she would make up for it with lower pay.

This argument no longer holds true. Do you think for a minute that anyone, no matter the age, who finds himself or herself unemployed for an extended period of time has any leverage to make salary demands? Thus, businesses are in a position to hire more experience for less pay. Assuming starting salaries are equal, which candidate would you hire: the 25-year-old with scant experience, or the 50-year-old with decades of experience? The former will cost your business time and money in training, along with lost productivity. The latter will bring your company a skill-set that will let him or her hit the ground running with little or no training. To me, the decision is a no-brainer. For this reason, I simply cannot accept Mr. Rich’s argument that those 50 and older might find themselves unemployed in perpetuity.

[Hat tip: The Word on Employment Law with John Phillips]

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus. For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

Double check data before termination to insulate from discrimination exposure

Pattison v. W.W. Grainger, Inc. [pdf], decided last week by the Cuyahoga County Court of Appeals, illustrates the need to analyze, confirm, and verify data before using the information as a justification for a termination decision.

Grainger terminated Wally Pattison (age 51) for allegedly failing to meet sales goals. At the time of his termination, Pattison held the position of Territory Manager, servicing accounts in the Greater Cleveland area. Pattison claimed that shortly after Sam DiMeo became his immediate supervisor, he took numerous adverse employment actions against him, including performance warnings for not meeting sales goals when younger employees who also were not meeting sales goals did not receive performance warnings. Pattison also claimed that DiMeo terminated him despite a significant rise in his performance numbers shortly before his termination, and despite the retention of younger employees with worse performance numbers.

The trial court dismissed Pattison’s age discrimination claim on summary judgment, finding that Grainger terminated Pattison solely for failing to meet legitimate business goals for five consecutive years. The court of appeals, however, in reviewing Pattison’s sales numbers in comparison to the 12 other Territory Managers who worked in the Cleveland district under DiMeo’s supervision, found that one could reasonably conclude that age motivated Grainger’s decision.

• According to DiMeo, the Cleveland district routinely failed to meet sales goals, being below goal for the three years prior to Pattison’s termination, and five out of the previous seven years.

• Despite the subpar performance of the entire Cleveland district, Pattison’s sales numbers consistently ranked in the mid-range of the 13 Territory Managers.

• At least five substantially younger Territory Managers had sales numbers worse than Pattison’s, yet were not terminated.

• One Territory Manager, 20 years Pattison’s junior, was below goal for half the time, but was never even threatened or reprimanded.

• Another Territory Manager, six years younger than Pattison, was promoted even though he had sales numbers four points lower than Pattison.

• Grainger lacked of any written (or even verbal) policies, procedures, or practices covering the number of years a Territory Manager could fail to meet sales goals before being terminated.

Based on this evidence, the court concluded: “Grainger claimed that it fired Pattison because of his poor performance; however, Grainger’s dissimilar treatment of significantly younger employees, whose performance figures were lower than Pattison’s, belies its assertion.”

Data can be very persuasive. The employer in this case, however, is now facing a jury trial because its explanation for the termination conflicted with the underlying numbers. You can almost guarantee that the employee’s attorney, a state or federal EEO investigator, a judge, and a jury will all spend time pulling apart your numbers to see if they jive with your legitimate non-discriminatory reason. Do yourself a favor and double-check for yourself anytime you plan to use the information in a termination decision.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus. For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

Do you know? Why statistics are so important in reduction in force cases

For the past week, I’ve been examining the use of statistics in workforce reduction discrimination cases (6th Circuit downgrades importance of statistics in reduction-in-force cases and How small is too small? Litigating sample sizes in reduction in force cases). What’s been missing from this analysis, however, is an explanation of why raw numbers are so important in these cases, especially in age discrimination claims.

Many workforce reductions are accompanied by an offer of severance to the group of terminated employees. In fact, I don’t think any employer should pay severance without getting something in return from the employee, namely a release and waiver of liability.

The Older Workers Benefit Protection Act requires all releases and waivers of federal age discrimination claims provided as part of a severance program offered to a group of employees (such as in a reduction in force) to include a written disclosure of the job titles and ages of all eligible individuals selected for the program and all not selected for the the program. The EEOC, in its guidance on Understanding Waivers of Discrimination Claims in Employee Severance Agreements, provides the following example of what this disclosure should look like:

Job Title	Age	# Selected	# Not Selected
(1)	25	2	4
	28	1	7
	45	6	2
	63	1	0
(2)	24	3	5
	29	1	7

When the lone 63-year-old employee in Job Title 1 is going to decide whether to sign the waiver or pursue an age claim, the only fact he and his lawyer will have to go on is that within his job grouping, 7 out of the 9 oldest employees were RIFed, including the oldest employee. In other words, the raw statistics that the court discussed (and dismissed) in Schoonmaker will likely be the critical piece of information on which your employees will base their decision whether to sue or walk away. And, you have no choice but to turn this information over. Failing to do so will result in the invalidity of the age discrimination waiver.

Schoonmaker may question the relevance of raw statistics, but because the numbers must be disclosed to the terminated employees, they are nevertheless critical to any workforce reduction decision.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus. For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

How small is too small? Litigating sample sizes in reduction in force cases

Last week’s post on the use of statistics in reduction in force cases garnered some interest from a fellow blogger, Stephanie Thomas. She argues on her blog that small sample statistics still have a place in workforce reduction litigation. After reading Stephanie’s take on this issue, we carried the conversation over to Twitter (Are you following me on Twitter @jonhyman? If not, shame on you).

My conclusion is that the Schoonmaker decision merely begs the question of how small of a sample size is too small to make pure statistics irrelevant in a RIF case. Stephanie and I agree that you will see more expert witness battles on the issue of whether a sample size is large enough to be statistically relevant.

If I’m defending a RIF, the first thing I’m doing is hiring a statistical expert to opine that the sample size is too small to be statistically significant. From there, I’ll argue that under Schoonmaker the case should be dismissed, unless the plaintiff can come forward with some “plus” evidence of discrimination.

Conversely, if a RIFed employee wants to rely on statistics alone, he or she will have to hire an expert to opine that the sample size is large enough to be statistically significant. If you have competing experts, you very well might have a factual issue over the sample size. Or, the judge could decide as a matter of law that the sample size is too small and toss out the statistics as irrelevant.

On my first read through Schoonmaker, I thought it gave concrete answers on a plaintiff’s prima facie requirements in a workforce reduction. After more deliberation, and a healthy Twitter debate with Stephanie Thomas, I’ve now concluded that Schoonmaker may create more questions than it answers.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus. For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

6th Circuit downgrades importance of statistics in reduction-in-force cases

Yesterday, I discussed a 6th Circuit decision that provided guidance to employers on how not to RIF an employee on FMLA leave. Today, I’m going to examine another decision out of the 6th Circuit this week on the issue of RIFs, which clarifies what a laid-off employee has to prove to establish age discrimination following a reduction in force.

RIFs provide a built-in protection for employers in age discrimination cases, because the legitimate non-discrimination reason for the termination – the economic necessity for the workforce reduction – is established from the outset. Thus, employees challenging a RIF on account of age have a higher prima facie burden. When a termination arises as part of a work force reduction, the plaintiff must provide “additional direct, circumstantial, or statistical evidence tending to indicate that the employer singled out the plaintiff for discharge for impermissible reasons.”

In Schoonmaker v. Spartan Graphics Leasing (6th Cir. 2/3/10) [pdf], the plaintiff claimed that the fact that her employer retained younger employees in her position, and that her employer RIFed the two oldest employees, satisfied the “additional evidence” necessary to overcome the employer’s economic justification for the RIF. The 6th Circuit correctly rejected this assertion, and in doing so put a dagger through the heart of the use of bald statistics of small samples in RIF cases:

If the plaintiff’s case-in-chief is viewed as satisfying the requirements for a prima facie case of age discrimination, then every employer who terminates an employee between 40 and 70 years of age under any circumstances, will carry an automatic burden to justify the termination….

[S]tatistical evidence may satisfy the fourth element in a work force reduction case ... [but] such a small statistical sample is not probative of discrimination.

In other words, in RIFs with a small sample size, an employee will have to come up with evidence other than pure statistics to go forward with a discrimination claim – evidence that that RIFed employee was objectively more qualified than the younger retained employees.

Despite this case, employers act at their own peril by ignoring statistics. Before any RIF is finalized, businesses should be analyzing the numbers across all key demographics, in addition to comparing the relative qualities and qualifications of the departing versus the remaining. Performing this diligence may not prevent a lawsuit from being filed (especially if the raw numbers appear to look discriminatory), but it will give you the necessary ammunition to defend any subsequent discrimination lawsuits that are filed.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus. For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

Do you know? Forced retirement is a no-no

It’s still a fairly popular misnomer that businesses can force employees to retire at a certain age. For example, last week Law.com reported on a verdict against a Connecticut pharmaceutical company that forced its Chief Patent Counsel to retire at age 65.

With the exception of a few limited circumstances, mandatory retirement ages are about as close to a slam dunk case of illegal age discrimination you can find. The exceptions permit – but do not require – mandatory retirement:

• at age 65 of executives or other employees in high, policy-making positions.
• at age 55 for publicly employed firefighters and law enforcement officers.

Forcing an employee out is the same as requiring an employee to require. While lessening duties and responsibilities, demotions, and reductions in pay could cause an older employee to retire, it could also cause that same employee to claim a constructive discharge. However, there is no law that says that an older employee does not have to meet the same legitimate expectations of the job as any other employee. If an older worker is not performing as needed or required, document and treat as you would any other employee.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus.

For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

Beware of discrimination risks when rehiring ex-employees

As the recession continues to show signs of ending, companies that had previously laid off employees will need to re-staff. According to CNN.com, a recent Department of Labor study finds that 38% of employers intend to recall cut workers. While a laid-off non-union employee has no right to be recalled or transferred into an open position, rehiring is not without legal risk. A recent 6th Circuit decision – Owens v. Wellmont, Inc. (6th Cir. 8/18/09) [PDF] – illustrates that employers need to pay as much attention to who is not recalled at to who is recalled.

After Wellmont eliminated Owens’s position in a reduction-in-force, she asked management about job openings in other departments. Wellmont hired younger candidates for those positions. The appellate court was bothered by the fact that management did not treat Owens’s discussions with management as formal applications for the open positions:

Owens did more than make a generalized expression of interest in working for Wellmont—Owens specifically informed Adams that Owens was interested in a position that was currently open.

As long as an employee makes a reasonable attempt to demonstrate to the employer an interest in the job, that employee can plead a discriminatory hiring claim if the job goes to someone else.

The lesson for employers is that if you are recalling RIF’ed employees, don’t discount someone merely because he or she did not make a formal application. If someone expressed interest in returning, it may be enough to trigger your responsibility to consider them for recall, or cause potential discrimination liability for failing to do so.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus.

For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

Bullying versus harassment

It is generally agreed that the anti-discrimination laws do not create a general code of workplace civility. Employees are generally expected to endure the usual tribulations of the workplace, such as the sporadic use of abusive language, offhand comments or jokes, occasional or simple teasing, normally petty slights, minor annoyances, and the simple lack of good manners. Harassing conduct is only actionable if it is objectively and subjectively severe or pervasive so as to alter the terms and conditions of one’s employment.

In light of this standard, consider the following set of facts, which arose in Hidy Motors, Inc. v. Sheaffer (Ohio Ct. App. 7/31/90), an age harassment claim brought by a 67-year-old car salesman:

• When the general manager would walk behind Sheaffer he would repeatedly say, “Come on old man, pick up your feet.”
• After Sheaffer told the general manager that a couple wanted to go home and think about buying a car, the general manager told him, “Come on old man, get your f****** head out of your f****** ass and go out there and slam them.”
• Referring to Sheaffer, the general manager directed another sales person to help the “old man” close a deal.
• In discussing a disagreement over a sales bonus, the general manager told Sheaffer, “Old man, I don’t give a f*** what you think. That’s the way it is going to be.”
• After a child spilled some water on the floor, the general manager told Sheaffer, “I’ve heard that’s what happens when you get your age - you can’t control yourself.”

Based on this conduct, the appellate court reversed the trial court’s summary dismissal of the age harassment claim and sent Sheaffer’s claim back for trial.

There is no doubt that this particular general manager has an interesting management style, and is probably what one would call a bully. But, should a few instances of a 67-year-old employee being called “old man” support a harassment claim? There is a clear line between general bullying/boorish management and actionable harassment. I question whether this case falls on the right side of that line.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus.

For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.