In the six weeks of 2017, the Third Circuit has issued some noteworthy new opinions on employment discrimination topics.
One of these cases is Karlo v. Pittsburgh Glass Works, LLC, (3rd Cir., Jan. 10, 2017) The matter arose after Pittsburgh Glass Works instituted a reduction in work force which terminated the employment of about 100 salaried employees in 40 locations and divisions. Seven of the discharged employees brought claims of age discrimination, asserting theories of disparate treatment, disparate impact and retaliation, and seeking class action certification. Two rulings by the United States District Court for the Western District of Pennsylvania are of particular interest. First, the District Court held that the employees were not entitled under the Age Discrimination in Employment Act (ADEA) to pursue claims of a sub-class of "fifty and older" workers who suffered disparate impact. The ADEA applies to any worker who is 40 years of age or older, and in this reduction-in-force, many of the 50 and older workers were allegedly replaced by younger workers who were 40 or older. Accordingly, the employees sought to distinguish the "fifty and older" group from all workers covered by the ADA (40 and older) because it would improve the statistical analysis (from the employee perspective) of that group's "disparate-impact" claim. As the Court noted, "disparate-impact claims do not require proof of discriminatory intent . . . [d]isparate impact redresses policies that are 'fair in form, but discriminatory in operation.' To that end, disparate-impact claims 'usually focus[] on statistical disparities . . . .'" It has been long established by the Supreme Court that age discrimination does not require that the adversely effected employee be replaced by a worker who is under 40 years old - an older worker replaced by a younger worker may have a viable age discrimination claim even though the replacement worker is over 40.
Accordingly, the Third Circuit held that it was consistent with this interpretation of the Act to allow employees to create a sub-group within their class which separated out older workers, noting that it was the individual employees' rights who were to be protected, not a group's rights [though this reasoning appears to be in discord with the logical syllogism of "disparate-impact" claims, which analyzes the impact on groups. The Court concluded that its ruling was also consistent with the remedial purpose of the ADEA, because, it reasoned, to hold any other way would impose a higher burden on the oldest workers, who were those most in need of the protection of the law. In this holding, the Court acknowledged that it was staking out a position which was at odds with rulings by three other Circuits: the Second, Sixth and Eighth. This may be important because a disharmony among the Circuit Courts is a weighty factor for the Supreme Court of the United States in determining whether it will hear an appeal.
The ruling of the Western District Court of Pennsylvania which the Third Circuit considered was the trial court's exclusion of an expert witness offered by the plaintiff employees to provide a statistical analysis which suggested that older employees were more likely to be terminated in a reduction in work force. The Third Circuit reversed, holding that the District Court was too rigorous in its Daubert analysis of the expert's methodologies, which should have been left to cross-examination and the weight of the expert's testimony and not his outright exclusion. But it appears that the primary reason the District Court excluded the expert, and the main reason the Third Circuit overruled it, was that the expert's analysis was specifically dependent on the recognition of a "fifty or older" subgroup, which the District Court had found improper. Thus, with the Third Circuit's reversal on that point, the principal reason for disqualification of that expert similarly evaporated.
Interestingly, the Third Circuit upheld the trial court's exclusion of a second report by the same expert espousing opinions on a different subject. The expert offered a second report which listed "twenty reasonable human resources practices" which the defendant could have implemented before engaging in a reduction in force, but did not do. The Third Circuit agreed with the District Court that the plaintiffs/employees could challenge practices which the defendant actually had which were unreasonable, but could not suggest that it should have engaged in other reasonable practices than those it used.