Many human resource managers worry about age bias suits whenever there’s a reorganization and older workers who don’t fit in the new company structure are terminated. But if you can show that your motives are business-related and you handle the situation properly, you’ll go a long way toward avoiding liability. Here’s a look at one recent case in which the employer did everything right – and managed to dodge a potentially expensive legal bullet.
Skills Don’t Match New Job
Stanford Horn worked as the regional communications manager for Cushman & Wakefield Western Inc. (C&W), a San Francisco commercial real estate firm. He was 55 years old when he was hired and had more than 30 years experience in public relations.After Horn had been at C&W for about four years, the company was reorganized, resulting in the termination of about a dozen managers. Horn’s supervisor decided to restructure the regional communications manager position by changing its focus from internal to external communications and public relations. Although Horn had received consistently positive performance evaluations, the supervisor decided that his skills were not well suited to the new job and terminated him. A less experienced 38-year-old from outside the company was eventually hired to replace him.
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No Discriminatory Intent
Horn sued C&W, charging the company with age discrimination. But C&W asked the court to dismiss Horn’s case, arguing that there was no evidence the company was motivated by bias when it terminated him – and the California Court of Appeal agreed.
What The Employer Did Right
Even though replacing an older worker with someone younger who has equal or lesser qualifications can create the impression that you discriminated, you can defend yourself by showing you had legitimate non-discriminatory reasons for making the choice. In this case, the employer had done a number of things that convinced the court it acted legally:
- Job duties were clearly defined. The court observed that although there was some overlap between the duties of the old and new positions, C&W was able to demonstrate that the two jobs differed substantially. In particular, the new position focused much more heavily on external communications and marketing than on the work Horn had been doing.
- Same person hires and fires. When the employee is hired and fired by the same manager, as in this case, the court said there’s less likelihood the termination was the result of age discrimination.
- No pattern of discriminatory remarks. Horn argued that on one occasion, after he had sent an important time-sensitive document to a supervisor by overnight mail, the person responded “Haven’t you ever heard of a fax before?” But the court concluded that this one “stray” remark, even if it reflected some age bias, was not enough to support a discrimination claim, especially when the comment didn’t come from the same person who made the termination decision.
- Employer acted consistently. Finally, the court was swayed by management’s consistent articulation of the same theme – that the responsibilities of the job had changed – and its ability to demonstrate why Horn wasn’t the person best suited for the new position.
Basing Older Employee’s Termination On High Salary
Note that although it wasn’t an issue in this case, it is legal in California to terminate someone because they earn a higher salary than a younger worker. But there are efforts under way to change this rule. For more details, see the Special Supplement on pending legislation in this month’s Bulletin.