ADEA – “Subgroup” Disparate Impact Claim

The U.S. Court of Appeals for the Third Circuit found that the Age Discrimination in Employment Act permits a “subgroup” of employees to bring a claim that others in the ADEA-protected group of employees age 40 and over received better treatment. In so holding, the Third Circuit disagreed with the Second, Sixth and Eighth Circuits, who have refused to recognize such a claim.

In Karol v. Pittsburgh Glass Works, LLC, a group of employees age 50 or more claimed that they were negatively impacted in a company reduction in force based on their age as compared with those younger, which included 40-50 year olds also protected by ADEA. The employer argued that ADEA does not permit claims by subgroups of the protected class. The Third Circuit, however, quoting the U.S. Supreme Court, held that “ADEA protects against age discrimination as opposed to 40 or over discrimination.” (Emphasis in original, internal quotations omitted).

For employers in the Third Circuit (which includes Delaware, New Jersey and Pennsylvania), this means that in preparing for a RIF or other layoff, they must take care to evaluate whether there is a negative impact on employees based on more specific ages – not just all those age 40 and over.