Adams, Wanda, et al. v. Florida Power Corp., et al. (04/01/2002)

By: Beth Musgrave, Medill News Service

Questions presented

Is the ""disparate impact"" method of proving age discrimination available to people suing under the Age Discrimination inEmployment Act (ADEA)?

Brief

From 1992 to 1996, more than 1,200 employees were laid off from Florida Power Corp.

Wanda Adams and more than one hundred workers for the power company that serves much of central Florida claimed they were fired because the company wanted to change its image and cut its costs for salaries and pensions.

Adams and her co-workers brought a federal class action suit against Florida Power, alleging that Florida Powers job cuts disproportionately affected older workers, in violation of the Age Discrimination in Employment Act of 1967 (ADEA). They have claimed that more than 70 percent of the people fired over the four year period were older than 40.

In 1996, the district court conditionally certified the class of former Florida Power employees claiming age discrimination. Then in August 1999, the court decertified the class, ruling that a ""disparate impact"" theory of liability is not available to those suing for age discrimination under the ADEA, as it is for those suing under Title VII of the Civil Rights Act for race discrimination. To prove disparate impact liability, a person or group must prove that a company may not have intentionally discriminated against a specific group or person, but its practices or actions unfairly affected them.

Florida Power was also claiming that the terminations were necessary to maintain its edge in a market that became more competitive in 1992 when Congress opened the electric utility industry to competition. The district court made no findings on whether the Adams class could produce evidence of disparate impact, instead allowing the case to be appealed to the 11th Circuit Court of Appeals on an issue of first impression — whether disparate impact claims can be brought for age discrimination under the ADEA.

On July 5, 2001, a unanimous 11th Circuit panel affirmed, ruling in favor of Florida Power, and holding that disparate impact claims cannot be brought under the ADEA. In so holding, the court indicated that its decision was consistent with the 1st, 3rd 7th and 10th Circuits, but contrary to opinions from the 2nd, 8th and 9th Circuits that ruled that because the language in the ADEA parallels language in Title VII, disparate impact claims should be allowed under the ADEA.

In the U.S. Supreme Courts 1993 opinion in Hazen Paper Co. v. Biggins, the Court left open the question of whether a disparate impact theory of liability is plausible under the ADEA. ""We have never decided whether a disparate impact theory of liability is available under the ADEA,"" the opinion stated.

Writing for the 11th Circuit, Judge Stanley Birch noted that the text of the ADEA differs from Title VII, in that the ADEA says that an employer may ""take any action otherwise prohibitedÉwhere the differentiation is based on reasonable factors other than age."" Furthermore, the language in the ADEA is similar to that in the Equal Pay Act, Birch wrote. The Equal Pay Act, which protects wage discrimination based on gender, says that wages can be different if ""the differential is based on any other factor other than sex.""

In specially concurring, Judge Rosemary Barkett wrote that disparate impact claims could be made on a case by case basis but the Adams case did not have the appropriate evidence to argue for disparate impact. ""The very question disparate impact analysis seeks to answer is whether the challenged policyÉ.is derived from a reasonable business judgment or whether the policy is the result of arbitrary discrimination. Claimants should have the opportunity to prove it when it is the latter.""

On Dec. 13, 2001, the U.S. Supreme Court granted certiorari in the case, but on April 1, 2002, the Court dismissed the case, concluding without comment that it had ""improvidently"" accepted the case.