Older, Wiser, and Out of Luck: Seventh Circuit Decision Limits Job Applicants’ Right to File Age Discrimination Claims (US)
On January 23, 2019, the Seventh Circuit Court of Appeals (which hears appeals from the federal district courts in and for Illinois, Indiana, and Wisconsin) issued an en banc decision in Dale E. Kleber v. CareFusion Corporation, a case in which the court wrestled with whether applicants for employment may successfully pursue disparate impact claims under the Age Discrimination in Employment Act (ADEA), the federal law that prohibits discrimination in employment on the basis of age.
Mr. Kleber, an attorney, applied for a position as in-house counsel with CareFusion. The job posting stated that the company sought applicants with “3 to 7 years (no more than 7 years) of relevant legal experience.” Mr. Kleber, age 58, had far more experience than the position called for and applied for the position notwithstanding the “experience cap.” CareFusion did not extend an interview to Mr. Kleber, and instead hired a 29-year old applicant who met but did not exceed the experience sought. Mr. Kleber filed suit, alleging that CareFusion’s experience cap had a disparate impact on older, qualified workers like himself.
The trial court sided with CareFusion, holding that the plain language of the ADEA permits job applicants to pursue claims of disparate treatment (claims that an employer intentionally discriminated against an individual on the basis of his age), but not claims of disparate impact (claims that an employer’s neutral employment policy or practice has a substantially greater negative impact on older workers).
A divided panel of the Seventh Circuit reversed, briefly resuscitating Mr. Kleber’s claim, but an en banc panel of the Seventh Circuit reheard the appeal and, despite a stinging dissent faulting the majority for arbitrarily ignoring the policy behind the ADEA, reinstated the district court’s decision in an 8-4 decision in favor of CareFusion. The majority opinion is a course in statutory construction. Whereas Congress expressly included applicants in certain provisions of the ADEA (such as those prohibiting employers from refusing to hire an individual because of his age and prohibiting labor organizations from discriminating against applicants for employment on the basis of age (disparate treatment)), Congress did not include job applicants in the section of the ADEA from which the theory of disparate impact claims derives and instead limits that section of the Act’s protections to those individuals with the “status of employee.” The court found this to be a clear expression of congressional intent to limit disparate impact claims to current employees, and barring job applicants from bringing such claims. Barring reversal by the Supreme Court, which, given the absence of contrary authority within the federal appellate courts, is highly unlikely, Mr. Kleber is out of a job, and out of luck.
Kleber is by no means an invitation for employers to publish facially discriminatory job postings or to utilize recruiting, screening, or hiring practices designed to exclude older workers. But the decision is a victory for employers, at least those operating in the Seventh Circuit, in that it forecloses disparate impact age discrimination claims by applicants for employment. To state a claim under the ADEA, applicants for employment in the Seventh Circuit (and Eleventh Circuit, which reached the same conclusion in 2016 in Villarreal v. R.J. Reynolds Tobacco) will need to show that the employer intentionally discriminated against them in the hiring process on the basis of their age, not simply that older workers were negatively impacted by neutral hiring practices.
Before celebrating the decision too much, Kleber may result in aggrieved older applicants foregoing the federal courts and seeking relief under state law. For example, California’s state age discrimination law expressly protects job applicants from age discrimination in a way the ADEA plainly does not. If the decision drives more litigants to state court, where the statutory damages caps applicable to federal age discrimination claims often do not apply, employers’ victory in Kleber may be Pyrrhic at best.