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After turning down several cases raising what some experts call the most important issue in age discrimination litigation today, the U.S. Supreme Court last week appeared ready to answer whether disparate impact claims can be brought under the federal Age Discrimination in Employment Act. The federal circuits have divided deeply on the issue since the high court suggested in a footnote in a 1993 decision that the availability of disparate impact claims under the age law, unlike most civil rights laws, was still an open question. Hazen Paper Co. v. Biggins, 507 U.S. 604. (A disparate impact claim alleges that a facially neutral policy adversely affects a protected class.) The high stakes involved in the answer can be seen in the classic split among the friends of the court filings in the latest high court case. Business groups and employers argue that permitting disparate impact claims will hamper severely the ability of employers to manage layoffs and other necessary business decisions, as well as encourage numerous lawsuits. THE ONLY TOOL? The AARP, job bias lawyers and civil rights groups contend that disparate impact claims are the only tool for countering today’s more sophisticated age discrimination in the workplace. More than half of the work force today — 75 million workers — are now age 40 or older, the age category protected by the ADEA. The justices, absent Chief Justice William H. Rehnquist, heard arguments on Nov. 3 in the case, Smith v. City of Jackson, Miss., No. 03-1160. And despite some concerns that a disparate impact tool could turn employers’ reasonable business decisions into age bias claims, many of the justices indicated the language of the statute itself may compel such claims. “The language of the statute is against you,” said Justice Stephen G. Breyer to Glen D. Nager of Jones Day, counsel to the city of Jackson. “The [Equal Employment Opportunity Commission (EEOC)] regulation embodies disparate impact. But the practicalities are absolutely with you.” Although Breyer believed that the “practicalities” weighed in favor of employers, neither Justice David H. Souter nor counsel to the police officers suing the city, Thomas Goldstein of Washington’s Goldstein & Howe, would concede that the “practicalities” were an insurmountable barrier to disparate impact claims. Both men suggested that the EEOC was capable of making rules to protect employers who make reasonable business decisions, while still giving workers the disparate impact tool to pursue those who discriminate. “Disparate impact comes from the text of the statute, not from thin air,” said Goldstein. UNFAIR PAY PLAN The Smith case stems from a suit filed by 30 police officers and public safety dispatchers against the city of Jackson and its police department charging that a pay performance plan discriminated against older workers by giving substantially larger salary increases to officers with five or fewer years of service. The city claimed that the plan was not discriminatory, but was designed to bring starting salaries for police officers up to the regional average. The high court first recognized the disparate impact theory in Griggs v. Duke Power Co., 401 U.S. 424 (1971). There the Court held that Title VII of the Civil Rights Act of 1964 applied not only to intentional race discrimination, but also to employer practices that were “fair in form but discriminatory in operation.” In that ruling, the Court relied on Title VII’s language prohibiting employers from discriminating “in any way which would deprive or tend to deprive any individual of employment opportunities or otherwise adversely affect his status as an employee.” In his argument, Goldstein told the justices that the ADEA, enacted in 1967, has language identical to the language in Title VII on which the Griggs Court relied to approve the disparate impact theory. “We have a really good case,” he said, referring to Griggs. He also noted a “wall of authority” in court rulings prior to 1993 recognizing disparate impact under the ADEA. And, he added, the EEOC for “a quarter of a century” has interpreted the ADEA, in a formal rule, to permit disparate impact. Breyer noted that the ADEA appears to give employers a defense to disparate impact claims — language permits employers to differentiate among workers based upon “reasonable factors other than age.” But if that language embodied too tough a test, he warned, “There will be a legal nightmare. Any effort by an employer to equalize pay or similar acts will have a disparate impact because of age.” Goldstein countered that “The liability threshold is not too high.” The important cases, he added, are “by and large” conciliated by the EEOC. 74 CASES There have been 74 reported disparate impact cases in the federal courts in the history of the statute, which, he added, discredits predictions by business and Nager that cases will flood the courts if the justices formally find disparate impact claims under the ADEA. But Nager sought to distinguish the ADEA from Title VII, noting that “Our mental and physical capacities are not constant over our lifetime,” whereas characteristics such as race and gender — which are covered by Title VII — are immutable. Nager said the ADEA’s language prohibiting discrimination “because of” age is “a natural reference to intent.” But Justice Antonin Scalia countered, “If that’s so, Congress shouldn’t have copied the language of Title VII.” Nager rejoined, “They copied it before Griggs was decided.” And Scalia again countered, “It’s a fair conclusion they want the two [statutes] to mean the same.” A decision by the high court is expected by July.

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