Age discrimination law applies to small government entities: High court

The U.S. Supreme Court held in a unanimous ruling Tuesday that the Age Discrimination in Employment Act applies to small government entities that employ fewer than 20 workers.

An attorney who represents employers said the ruling will lead to higher employment practices liability rates for these entities.

The Mount Lemmon Fire District, a political subdivision in Arizona, had argued a provision in the ADEA that said the law did not apply to firms with fewer than 20 workers also applied to political subdivisions of the same size, according to the ruling in Mount Lemmon Fire District, petitioner, et. al. v. John Guido, et al., which upholds a decision by the 9th U.S. Circuit Court of Appeals in San Francisco.

The ruling said the fire district, which was faced with a budget shortfall, had laid off its two oldest full-time firefighters, John Guido, then 46, and Dennis Rankin, then 54. The men sued the fire district, alleging their termination violated the ADEA.

The focus of the court’s ruling was the definition of whom the law covers in the statute: “The term ‘employer’ means a person engaged in an industry affecting commerce who has twenty or more employees….The term also means (1) any agent of such a person, and (2) a State or political subdivision of a State.”

The question presented, said the ruling, was whether the specification of 20 or more employees was applicable to political subdivisions, or did the phrase “also means” in the definition set up a separate category, which obligated smaller political entities to follow the ADEA’s provisions.

The ruling agreed with the 9th Circuit that the latter was the case. “First and foremost, the ordinary meaning of ‘also means’ is additive rather than clarifying,” said the ruling.

“Instructive as well, the phrase ‘also means’ occurs dozens of times throughout the U.S. Code, typically carrying as an additive meaning… Furthermore the text of (the statute) pairs States and their poetical subdivisions with agents, a discrete category that, beyond doubt, carries no numerical limitations.”

“The Fire District warns that applying the ADEA to small public entities risks curtailment of vital public services such as fire protection.  Experience suggests otherwise,” said the nine-page ruling.

“For 30 years, the Equal Employment Opportunity Commission has consistently interpreted the ADEA as we do today, said the ruling, in upholding the 9th Circuit’s 2017 decision in the case.

Justice Ruth Bader Ginsburg delivered the opinion. Recently appointed Justice Brett Kavanaugh did not participate in the vote.

Adam H. Sencenbaugh, a partner with Haynes and Boone LLP in Austin, said the ruling will lead to higher EPLI rates for these small special interest districts, which number in the thousands throughout the United States. “I think definitely the additional exposure will lead to increased rates for those small districts.”

He said amicus briefs submitted to the court on behalf of these entities said, “If we face litigation and try to mitigate that through our insurance coverage,” it will lead to higher rates “and further degrade our ability to accomplish our mission,” with is usually of a public service nature, said Mr. Sencenbaugh.

Victoria A. Lipnic, acting chair of the U.S. Equal Employment Opportunity Commission, in a report issued in June, said that older workers are still confronting “unfounded and outdated” assumptions about age and ability.