PHILADELPHIA – A decision by the U.S. Court of Appeals
for the Third District has identified subgroups as a segment of employees that
cannot be discriminated against under the Age Discrimination in Employment Act
Under the ADEA, the court found that the claim of
disparate impact by a group of employees over the age of 40 was just in the
Karlo v. Pittsburgh Glass Works, LLC case. The case involves a group of
employees who were terminated as a result of workforce reduction at Pittsburgh
an automotive glass manufacture, due to declining sales.
Those employees were all
older than 50 and had formed a subgroup for a collective action lawsuit against
their employer. In the suit, the plaintiffs claimed that a disparate impact had
occurred to those who were terminated by the company and over the age of 40 as
outlined in the ADEA.
The case was initially brought to the district court, where the defendants filed for summary judgment, which was granted. In an appeal, the court ruled in favor of the plaintiffs, allowing
the claims for disparate impact, as it found the employer “caused a
significantly disproportionate adverse impact on age” to the subgroup identified
in the case.
“Prior to Karlo, no federal circuit court of appeals recognized that plaintiffs who sued under the
disparate-impact provision of the Age Discrimination in Employment Act may assert that the policy complained of adversely affected only a 'subgroup' of those 40 and older in violation of the ADEA,” Kevin R. Miller, an
associate at Genova Burns, told The Pennsylvania Record. “In Karlo, the Third Circuit stated quite
clearly that if a plaintiff can show that a specific employment policy
adversely affected a 'subgroup' of employees over the age of 40,
it does not matter whether the policy did not adversely affect all employees over 40.”
The ruling creates a split in the circuit courts, which could lead to a
more formal review by the Supreme Court. In the near term, Miller believes the
case may be reheard en banc, but with Chief Judge D. Brooks Smith writing the decision,
it may weigh against a rehearing.
“In the short term, the decision may lead to the defendant-employer
petitioning the Third Circuit to re-hear the case en banc, meaning every judge on the Third Circuit would have a
chance to weigh in,” Miller said. “The Karlo
decision was only decided by a panel of three judges on the Third Circuit. However,
there is less of a chance of an en
banc hearing when no judge on the panel has dissented, as is the case
Miller thinks it's more likely that attorneys will push courts to adopt this decision, instead of plaintiffs trying to get more favorable
rulings in age discrimination cases in
the Third Circuit.
“I think the more likely
result is that in cases throughout the country where this type of claim is not
yet recognized, you will see a greater push by plaintiffs’ attorneys to argue
that their circuits should adopt the rationale behind the Third Circuit’s
decision, and they will be able to cite to the Karlo decision for support," he said.