A number of federal, state, and local laws make it illegal to discriminate against a job candidate or employee on the basis of age. For example, theAge Discrimination in Employment Act (ADEA) prohibits discrimination based on age for persons 40 or older. Violations of laws prohibiting age discrimination carry steep legal penalties as well as significant reputational damage.
In reminding employers to be proactive in addressing age discrimination, there have been two important developments from the Equal Employment Opportunity Commission (“EEOC”).
First, in a press release on June 11, 2020, the EEOC announced it had reached a $10,000,000 settlement with Jet Propulsion Laboratory (“JPL”), the national research and development center focusing on robotic space exploration and study. The settlement arises from litigation filed in federal district court in Los Angeles. The EEOC alleged that JPL systemically laid off employees over the age of 40 in favor of retaining younger employees and passed over employees aged 40 or over for rehire in favor of less qualified, younger employees. In addition to the significant monetary relief, JPL must provide to affected employees, the settlement with the EEOC contains a consent decree requiring JPL to take directed actions to root out age discrimination in its workforce. According to the press release:
“JPL has agreed to retain an EEO monitor, a diversity director and a layoff coordinator to monitor compliance with the ADEA and this decree, and ensure that JPL takes no further action that has a disparate impact on employees in the protected age group. JPL will also review and, if necessary, revise policies and procedures against all discrimination under the ADEA. Further, JPL agreed to provide training to all employees on age discrimination and report to the EEOC on recruitment, hiring, layoffs, terminations and complaints about age discrimination, along with the monitoring of such complaints to prevent retaliation. The EEOC will monitor compliance with this agreement.”
This swath of directives will require an investment of substantial hours of time and resources on the part of JPL for at least three years.
Second, also onJune 11, 2020, the EEOC issued updated guidance on the treatment of individuals 40 and older in the workplace when implementing COVID-19-related precautions. The EEOC noted that while the CDC has highlighted individuals 65 or older as at higher risk for severe cases of COVID-19, they should not be excluded from the workplace based on their age. This legal obligation holds true, as the EEOC stated, “even if the employer acted for benevolent reasons such as protecting the employee due to higher risk of severe illness from COVID-19.” The EEOC guidance also noted that while persons 40 or older do not have the right to a reasonable accommodation based on their age, in contrast to other federal laws such as the Americans with Disabilities Act, which provides the right to a reasonable accommodation based on a disability, the ADEA does allow employers to provide flexibility to workers age 65 and older, even if it results in younger workers ages 40-64 being treated less favorably based on age in comparison.
These two developments—the JPL settlement and the updated EEOC guidance on age discrimination—provide a clear warning to employers to remain proactive on issues of age discrimination. Experts across the human capital, legal services, and business intelligence industries recommend a pay equity audit as a critical tool in employer’s risk management tool belt. A pay equity audit can measure, among other important data points, the age effects on compensation to determine if age discrimination in setting wages poses a risk to operations. It can also provide actionable intelligence to address such risk before, for example, the EEOC gets involved.
Not sure how to get started? Let Trusaic provide your organization with a free Pay Gap Analysis, which can be conducted confidentially. Here is what you will get:
1-hour consultation to our pay equity team comprised of regulatory compliance experts and data scientists;
Answers to your pay equity questions;
A pay gap analysis of your workforce.
Conducting a pay equity audit is a key component to ensuring equitable compensation within your organization. Just as important as the analysis is how you communicate findings and progress with various stakeholders. Download The Pay Equity Communications Planner to learn best practices for discussing compensation, both internally and externally.