The EEOC has requested comments on its suggested changes to the regulations governing disparate impact claims under the ADEA. Disparate impact claims are those that involve a facially neutral practice that has an adverse impact on persons who are age 40 and older. As discussed below, the proposed regulations are consistent with the agency’s position in Meacham v. Knolls Atomic Power Laboratory, 461 F.3d 134 (2d Cir. 2006), petition for cert. granted, 128 S.Ct. 1118 (2008), a case that will be argued before the Supreme Court on April 23, 2008.The EEOC’s changes would replace its current disparate impact age discrimination regulation with a regulation that conforms to the Supreme Court’s decision in Smith v. City of Jackson, 544 U.S. 228 (2005). Specifically, the EEOC would change 29 C.F.R. § 1625.7(d) to require plaintiffs who assert disparate impact age discrimination claims to “isolate[] and identify[] the specific employment practice that is allegedly responsible for any observed statistical disparities.” Additionally, the proposed regulation interprets the ADEA to require that when an employer asserts that some challenged practice is lawful because the practice is attributable to a “reasonable factor other than age” (”RFOA”), “the employer bears the burden of proving that the ‘reasonable factor other than age’ exists.”

In Smith, the Court determined that the ADEA permits disparate impact age claims. Unlike Title VII, which permits disparate impact race, color, sex, religion, and national origin claims, employers may defend ADEA disparate impact claims if the alleged discriminatory practice is justified by a RFOA.  Title VII provides a defense to disparate impact discrimination only when the practice is job related and consistent with business necessity. 

The question of whether a plaintiff or a defendant bears the burden of proving a RFOA in a disparate impact age discrimination case is currently pending before the Supreme Court of the United States in the Meacham case. The EEOC’s regulation seeks to settle the issue in Meacham, apparently before the Court issues its decision. Any comments about the EEOC’s proposed regulation must be received by May 30, 2008, and the EEOC may issue a final regulation anytime thereafter. The Supreme Court’s Meacham decision will likely issue by the end of June. 

The EEOC’s proposed treatment of the RFOA as an affirmative defense is inconsistent with decisions by the Second and Tenth Circuits, both of which have held that an employer only has a burden of production, not a burden of persuasion with respect to the RFOA. The Second and Tenth Circuits liken the ADEA to the pre-1991 Title VII disparate impact claims and place the ultimate burden of proof with the plaintiff. Meacham will decide this issue.

The EEOC’s proposed regulation is consistent with briefs the Commission filed in the Meacham case. Whether the Supreme Court will agree with the Commission remains to be seen, but even if the Court does agree, the Court already decided in the Smith case that the scope of disparate impact age discrimination is quite narrow. Nothing about the EEOC’s proposed regulation changes the Court’s decision in Smith.

The EEOC has asked interested parties to comment on whether the regulations should provide suggestions on the meaning of “reasonable factors other than age” standard. EEOC also asked whether explanations should refer to tort law standards such as negligence and reasonable standard of care when defining “reasonable.” Finally, the EEOC asked whether the regulations should offer factors relevant to whether an employment practice is based on reasonable factors other than age.