On November 16, 2011 the Equal Employment Opportunity Commission (EEOC) approved proposed changes to the 1967 Age Discrimination in Employment Act (ADEA), which protects employees over the age of 40. The proposed changes will now be sent to the Office of Management and Budget (OMB) at the White House. If the OMB approves the changes, they will be returned to the EEOC for final approval. The proposed changes are in response to recent Supreme Court cases regarding disparate impact claims and "reasonable factors other than age" (RFOA) defenses.
Disparate impact occurs when an employer's actions affect a protected class inadvertently. These claims frequently arise from staff-reduction cuts or the implementation of new compensation programs. While the discrimination is not intentional, a protected group is negatively affected by the decision. In response to disparate impact claims related to age, employers often use the "reasonable factors other than age" defense, stating the changes made were not based on age, but were made for other reasons. In this proposed amendment, the EEOC gives guidelines regarding whether or not a factor is reasonable and if the factor was based on something other than age.
To test reasonableness, the EEOC lists the following factors:
- whether the employment practice and the manner of its implementation are common business practices;
- the extent to which the factor is related to the employer's stated business goal;
- the extent to which the employer took steps to define the factor accurately and to apply the factor fairly and accurately (e.g., training, guidance, instruction of managers);
- the extent to which the employer took steps to assess the adverse impact of its employment practice on older workers;
- the severity of the harm to individuals within the protected age group, in terms of both the degree of injury and the numbers of persons adversely affected, and the extent to which the employer took preventive or corrective steps to minimize the severity of the harm, in light of the burden of undertaking such steps; and
- whether other options were available and the reasons the employer selected the option it did.
- the extent to which the employer gave supervisors unchecked discretion to assess employees subjectively;
- the extent to which supervisors were asked to evaluate employees based on factors known to be subject to age-based stereotypes; and
- the extent to which supervisors were given guidance or training about how to apply the factors and avoid discrimination.