Issue
In Smith v. City of Jackson, Mississippi (2005 Daily Journal D.A.R. 3713, 18 Fla. L. Weekly Fed. S 211, U.S., Mar. 30, 2005), the United States Supreme Court considered the issue of whether the disparate impact theory, which is recognized in Title VII cases, should also be recognized in cases of discrimination in violation of the Age Discrimination in Employment Act (ADEA).
Facts
In an effort to bring the starting salaries of police officers up to the regional average, the City of Jackson, Mississippi (City) granted raises to all police officers and dispatchers. Those employees with fewer than five years service received proportionally greater raises than more senior employees. A group of older officers filed a lawsuit under the ADEA claiming they were “adversely affected” because of their age (a “disparate impact” claim). In an appeal from the federal District Court, the United States Court of Appeals ruled in favor of City, concluding that the ADEA does not recognize a disparate impact claim. The Supreme Court agreed to hear the officers’ appeal.
Appellate Court Decision
Discrimination cases under Title VII (e.g., racial and gender discrimination cases) fall into two categories: disparate treatment cases, which require a showing of discriminatory intent by an employer; and disparate impact cases, which require a showing that an employer’s practices have an adverse affect on a protected employee or group of employees. For the first time, the Supreme Court in this case recognized the second type of case – disparate impact – in ADEA cases. The language of the ADEA was the main reason for the Court’s decision – the ADEA 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 such individual’s age . . . .”
Although the disparate impact theory may be used in an ADEA case, the scope of disparate impact liability is narrower under the ADEA than under Title VII. Unlike Title VII, the ADEA provides that an employer’s “otherwise prohibited” action may be acceptable if the differentiation in treatment is based on “reasonable factors other than age.” This principle recognizes that age, unlike race or other classifications protected by Title VII, is sometimes relevant to the ability to engage in certain types of employment. Thus, certain employment criteria may adversely impact older workers as a group.
Applying the disparate impact theory to the officers’ allegations, the Court held that City’s plan was based on reasonable factors other than age. Although City’s method for calculating salaries resulted in officers with fewer years of experience receiving proportionally greater raises, the differential occurred because City believed that, to retain junior officers, it needed to raise salaries to stay competitive.
Thus, while the Supreme Court recognized disparate impact cases under the ADEA, it supported the City because the officers could not prove disparate impact under the relevant facts.