Smith v. City of Jackson
2005 U.S. LEXIS 2931, 161 L. Ed. 2d 410, 544 U.S. 228 (2005)
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Rule of Law:
The Age Discrimination in Employment Act (ADEA) authorizes disparate-impact claims, where a facially neutral employment practice disproportionately harms older workers, but liability is narrower than under Title VII as an employer may defend such a claim by showing the practice was based on a 'reasonable factor other than age' (RFOA).
Facts:
- The City of Jackson, Mississippi, employed a group of police and public safety officers.
- On October 1, 1998, the City adopted a pay plan to grant raises to all city employees, aiming to attract and retain qualified people and maintain competitiveness.
- On May 1, 1999, the City revised the pay plan, motivated by a desire to bring the starting salaries of police officers up to the regional average.
- Under the revised plan, officers with less than five years of tenure received proportionately greater pay raises compared to their former pay than officers with more seniority.
- While some officers over 40 had less than five years of service, the majority of older officers had more seniority.
- As a result, older, more senior officers generally received smaller pay increases when measured as a percentage of their prior salary.
Procedural Posture:
- A group of older police officers (Petitioners) sued the City of Jackson in the U.S. District Court, alleging both disparate-treatment and disparate-impact age discrimination under the ADEA.
- The District Court, a court of first instance, granted summary judgment to the City on both claims.
- The officers appealed to the U.S. Court of Appeals for the Fifth Circuit, an intermediate appellate court.
- The Court of Appeals affirmed the dismissal of the disparate-impact claim, holding that such a theory of recovery is categorically unavailable under the ADEA.
- The Court of Appeals, however, reversed the summary judgment on the disparate-treatment claim, ruling it was premature.
- The officers (Petitioners) petitioned the U.S. Supreme Court for a writ of certiorari to review the appellate court's dismissal of their disparate-impact claim, and the Court granted the petition.
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Issue:
Does the Age Discrimination in Employment Act of 1967 (ADEA) authorize recovery for employment practices that, while facially neutral, have a disproportionately adverse effect on older workers (a 'disparate-impact' claim)?
Opinions:
Majority - Justice Stevens
Yes. The Age Discrimination in Employment Act (ADEA) authorizes recovery in disparate-impact cases. The text of ADEA §4(a)(2), which prohibits employer actions that 'otherwise adversely affect' an employee's status 'because of... age,' is identical to the parallel provision in Title VII, which this Court in Griggs v. Duke Power Co. interpreted as authorizing disparate-impact claims. This focus on the consequences of an employment practice, rather than the employer's motivation, supports such claims. Furthermore, the ADEA's 'reasonable factors other than age' (RFOA) provision in §4(f)(1) confirms this interpretation, as it provides a defense for neutral practices that would be unnecessary if the ADEA only forbade intentional discrimination. However, the scope of liability under the ADEA is narrower than under Title VII; the RFOA defense is less stringent than Title VII's 'business necessity' test, and the pre-1991 Wards Cove framework for disparate-impact claims applies. In this case, the officers failed to state a valid claim because they did not isolate a specific employment practice and the City's plan was based on reasonable factors—seniority and position—to achieve the legitimate goal of making salaries competitive.
Concurring - Justice Scalia
Yes. Disparate-impact claims are cognizable under the ADEA, and this conclusion should be reached by deferring to the reasonable interpretation of the Equal Employment Opportunity Commission (EEOC). This is a classic case for Chevron deference, as the EEOC has express rulemaking authority and promulgated a regulation that clearly contemplates disparate-impact liability by stating that age-neutral practices with an adverse impact must be justified as a 'business necessity.' Since the agency charged with administering the statute has consistently and reasonably interpreted it to allow for disparate-impact claims, the Court should defer to that interpretation rather than conducting its own independent analysis of the statutory text.
Concurring - Justice O'Connor
No. Disparate-impact claims are not cognizable under the ADEA. The plain text of the ADEA, specifically the phrase 'because of... age' in §4(a), requires proof of discriminatory intent. The RFOA provision acts as a safe harbor for employers against claims of intentional discrimination, not as a defense to disparate-impact claims. The ADEA's legislative history, particularly the Wirtz Report, distinguished between prohibiting 'arbitrary discrimination' (disparate treatment) and addressing the disparate effects of certain practices through noncoercive measures. Unlike race, age is often correlated with legitimate employment factors, and extending Griggs is inappropriate because it was decided after the ADEA's passage and its rationale for remedying historical discrimination does not apply to age. The judgment should be affirmed because this type of claim is not permitted under the statute.
Analysis:
This decision resolved a circuit split by formally recognizing that disparate-impact claims are cognizable under the ADEA, but it simultaneously narrowed their potential for success. By establishing that the employer's defense is the lenient 'reasonable factor other than age' (RFOA) standard, rather than Title VII's stricter 'business necessity' test, the Court made these claims much more difficult for plaintiffs to win. The ruling also held that the more employer-friendly burden-shifting framework from Wards Cove applies to ADEA disparate-impact cases. The decision thus created a cause of action in theory while erecting significant practical barriers to prevailing on such a claim, shaping the landscape of age discrimination litigation for years to come.
