Up on Fortune magazine’s column “Practically Speaking” is the following question:
Frank has been with us for more than 20 years. He works in the warehouse and has done a good job for us. I like him. But, to be honest, for the work he performs I could easily replace him someone younger and … cheaper. Would it be wrong to let him go?
Well, what a loaded question. The advice column side-steps an important issue and gets into a discussion regarding overhead, benefits, etc.
If you follow this path blindly, you may walk right into a lawsuit.
Why? Because discrimination laws prohibit discrimination on the basis of age and you’re already acknowledging that you want someone “younger” — even if salary considerations may also be involved.
In fact, there have already been cases that talk about similar scenarios. In one case, a supervisor told an employee that he was “looking for younger single people” and that, as a consequence, the employee “wouldn’t be happy [at the company] in the future.” In other cases, comments about replacing workers with “younger, cheaper” ones can also be used to support an age discrimination claim.
Even without the comment, a replacement by an employer of an employee with someone significantly younger can give rise to an inference of age discrimination.
So, case closed?
Well, maybe in this instance, since the employer already has this “younger” notion embedded in its decision-making process.
But suppose the employer is looking to cut costs and wants to replace higher salaried workers with cheaper ones: Can it do that?
Well, after the court’s decision in Gross (which I discussed way back here): Maybe. The court there held that age must be the decisive factor in the employer’s decision and that “but for” the employee’s age, the employer would not have made the same decision.
Thus, an employer who believes it can get the same work done by an someone at a lower salary may sometimes survive an age discrimination claim — so long as age doesn’t factor into the decision. But before you do this, be sure to consult with legal counsel as it’s a minefield to navigate. This is particularly true in Connecticut where it remains to be seen how closely the courts will truly follow federal law in this instance.
And one more note: Terminating employees to avoid further pension obligations or other benefits is likely illegal in many instances under federal law. The Older Workers Benefit Protection Act (OWBPA), which we often think of as only applying to separation agreements, also made it illegal for employers to use an employee’s age as the basis for discrimination in benefits, and to target older workers for their staff cutting programs on the basis that benefits were too costly.
Cost considerations are certainly important for companies to consider. But tying those considerations to age is a step too far under the law. Be sure to understand the distinctions. And try not to blindly follow advice columns (or even blog posts!); each circumstance is different and getting appropriate legal advice in this instance really is critical.