The U.S. Equal Employment Opportunity Commission
EEOC NOTICE Number 915.002 Date 9-18-96 1. SUBJECT: Enforcement Guidance on O'Connor v. Consolidated Coin Caterers Corp. 2. PURPOSE: This enforcement guidance analyzes the impact on EEOC enforcement activities of the Supreme Court's ADEA decision in O'Connor v. Consolidated Coin Caterers Corp., 116 S. Ct. 1307 (1996), holding that a prima facie showing of age discrimination in discharge does not require the plaintiff's replacement to be outside the protected age group.1 3. EFFECTIVE DATE: Upon issuance. 4. EXPIRATION DATE: As an exception to EEOC Order 205.001, Appendix B, Attachment 4, Section a(5), this Notice will remain in effect until rescinded or superseded. 5. ORIGINATOR: ADEA Division, Office of Legal Counsel. 6. INSTRUCTIONS: File after the last Enforcement Guidance in the 800 series of Volume II of the EEOC Compliance Manual. 7. SUBJECT MATTER: I. Background and Holding of Decision On April 1, 1996, the U.S. Supreme Court issued its decision in O'Connor v. Consolidated Coin Caterers Corp., 116 S. Ct. 1307 (1996).2 The O'Connor decision addressed the narrow question of whether, in order to make out a prima facie case, a plaintiff alleging that he was discharged in violation of the Age Discrimination in Employment Act of 1967, as amended (ADEA), 29 U.S.C. § 621 et seq., must show that he was replaced by someone outside the protected age group (i.e., someone under the age of 40). A unanimous Court held that replacement by someone under 40 was not a necessary element of an ADEA prima facie case. The plaintiff in O'Connor, who was 56 years old at the time he was discharged, had filed suit in federal district court alleging that he had been dismissed by the defendant corporation because of his age. The district court granted the defendant's motion for summary judgment. On appeal, the Court of Appeals for the Fourth Circuit affirmed the district court's dismissal of the case. Applying the McDonnell Douglas3 framework, the Fourth Circuit stated that the plaintiff in a non-reduction-in-force case could establish a prima facie case of age discrimination only if he showed that: (1) he was in the ADEA protected age group (PAG); (2) he was discharged or demoted; (3) at the time of his discharge or demotion, he was performing his job at a level that met his employer's legitimate expectations; and (4) following his discharge or demotion, he was replaced by someone of comparable qualifications outside the PAG. The court concluded that the plaintiff had failed to make out a prima facie case because the plaintiff's replacement was 40 years old and, thus, was in the PAG. The Supreme Court reversed. The Supreme Court initially noted that it had never had occasion to decide whether the basic evidentiary framework set forth in McDonnell Douglas applied to the ADEA. However, since the parties did not contest that point and since the Fourth Circuit, like every other federal court of appeals, had applied some variant of McDonnell Douglas to ADEA disparate treatment cases, the Court assumed for purposes of the decision that it did apply. Thus viewing the prima facie case from the perspective of the McDonnell Douglas framework, the Court stated that there must be "at least a logical connection between each element of the prima facie case and the illegal discrimination for which it establishes a 'legally mandatory, rebuttable presumption.'" 116 S. Ct. at 1310 (citation omitted). The Court found that the element of replacement by someone under 40 failed to meet this requirement. Id. The Court reasoned that no greater inference of age discrimination (as opposed to PAG discrimination) could be drawn when a 40-year-old is replaced by a 39-year-old (i.e., someone outside the PAG) than when a 56-year-old is replaced by a 40-year-old (i.e., someone within the PAG). Id. The Court concluded that, "[b]ecause it lacks probative value, the fact that an ADEA plaintiff was replaced by someone outside [the PAG] is not a proper element of the McDonnell Douglas prima facie case." Id. In reaching its conclusion, the Court emphasized that the ADEA prohibits discrimination "because of [an] individual's age." The statutory language "does not ban discrimination against employees because they are aged 40 or older [i.e., in the PAG]; it bans discrimination against employees because of their age, but limits the protected class to those who are 40 or older." 116 S. Ct. at 1310. The Court observed: "The fact that one person in the [PAG] has lost out to another person in the [PAG] is thus irrelevant, so long as he has lost out because of his age." Id. (emphasis in original). The Court further remarked, in dicta, that a prima facie case requires "'evidence adequate to create an inference that an employment decision was based on a[n] [illegal] discriminatory criterion,'" 116 S. Ct. at 1310 (quoting Teamsters v. United States, 431 U.S. 324, 358 (1977)), and that such an inference cannot be drawn by the replacement of one worker with another worker who is "insignificantly younger." Id. Because the ADEA prohibits discrimination based on age rather than on class membership, the Court suggested that, in the age-discrimination context, "the fact that a replacement is substantially younger than the plaintiff is a far more reliable indicator of age discrimination than is the fact that the plaintiff was replaced by someone outside the [PAG]." Id. II. Questions and Answers The following questions and answers set forth the Commission's position on issues that arise in relation to the O'Connor decision. 1. Q. What is the basic holding of O'Connor? A. The O'Connor decision holds that a prima facie showing of age discrimination does not require the plaintiff's replacement (if any) to be younger than the PAG minimum age (i.e., 40 years old). 2. Q. Does the O'Connor decision change the way in which investigators should process age discrimination charges? A. No. O'Connor is consistent with the Commission's long-standing position that an ADEA charge should never be rejected or dismissed on the merits solely because a charging party states that his or her replacement (or comparator) is an individual within the ADEA's protected age group (40 and older). Indeed, it is the Commission's view that the characteristics of the comparator are not a necessary element of the prima facie case under the ADEA, Title VII, the Americans with Disabilities Act (ADA), or the Rehabilitation Act of 1973.4 3. Q. Is it possible after O'Connor to establish a prima facie case and, ultimately, a violation of the ADEA where the respondent does not hire a replacement for the charging party? A. Yes. The decision's holding is not dependent upon the respondent's hiring a replacement for the charging party. O'Connor holds only that, when the age of a replacement is made a part of the prima facie case, that case is not defeated solely because the replacement happens to be within the protected age group. 4. Q. In dicta, the O'Connor Court uses the terms "insignificantly younger" and "substantially younger" in referring to a plaintiff's replacement. Does the decision define these terms? A. No. In discussing the strength of an inference of age discrimination that might be drawn from the facts of a particular case, the Court merely offers the example of a 68- year-old replaced by a 65-year-old and suggests that such facts might amount to "creating a prima facie case on the basis of very thin evidence." 116 S. Ct. at 1310. 5. Q. Is it necessary to make a specific determination regarding whether the charging party's replacement/ comparator is "insignificantly" or "substantially" younger than the charging party? If so, since the O'Connor decision does not define these terms, how will the Commission make that determination? A. It is not necessary to specifically categorize that age difference as "insignificant" or "substantial." As in the past, however, the relative ages of the charging party and his/ her replacement/comparator may be relevant evidence as to the merits of the case. Where a specific determination on this point must be made, the Commission will make it on a case-by-case basis. We emphasize, moreover, that there is no "bright line" test for determining whether the age difference can be considered either "insignificant" or "substantial." Whether the age difference is sufficient to support a finding of age discrimination is simply one of the issues to be considered in assessing the case. (See discussion below.) 6. Q. Does the O'Connor decision require a "no cause" dismissal of a charge where it is determined that the charging party was replaced by a person who is only slightly younger? For example, should a charge alleging discharge because of age be dismissed if the charging party's replacement is only two or three years younger than the charging party? A. No. Under no circumstances should a charge be dismissed without investigation solely because the charging party's replacement is only slightly younger. Field offices have the discretion to consider this point along with all other facts and circumstances when making a decision on appropriate resource commitment and a determination on the merits. 7. Q. Under what circumstances might a field office issue a cause determination even though the comparator is only slightly younger than the charging party? A. There may be a number of circumstances in which such a cause determination is proper. The fact that the age difference between the charging party and his/her comparator is not "substantial" is simply one piece of evidence that must be weighed along with all other evidence in determining whether there is reasonable cause. For example: (1) If the evidence showed that the slightly younger comparator was selected for the purpose of disguising age discrimination, the relatively slight difference in age would not defeat the charging party's case. Such might be the case where, for instance: * Despite the slight difference in age, the comparator looks appreciably younger, more vigorous, and robust, and the employer has commented favorably on the comparator's "youthful" appearance. * The replacement is someone who is nearing retirement age and who has expressed an interest in retiring -- thus clearing the way for the employer to hire a considerably younger replacement. (2) An employer's history of taking action against its oldest workers would support an inference of age discrimination where the comparator was only slightly younger than the charging party. (3) Evidence that age-based comments were made in connection with the allegedly discriminatory action would buttress an inference of age discrimination despite a relatively slight age difference. (4) Even if the comparator is only slightly younger than the charging party, his/her being less qualified for the job would also support an inference of age discrimination. (5) If the slightly younger replacement was hired by someone other than, and outside the control of, the person who fired the charging party, the inference of age discrimination would not be undermined by the relatively small age difference (since the firing and hiring were separate and independent acts by two different individuals). Where the comparator is only slightly younger than the charging party, but the totality of the evidence is adequate to create an inference of age discrimination, the field should issue a cause determination whenever the respondent fails to articulate a legitimate, non-discriminatory reason for its action, or whenever it is determined that the articulated reason is a pretext for illegal discrimination. 8. Q. Is it appropriate after the O'Connor decision for the Commission to continue to apply the McDonnell Douglas prima facie case framework in age cases? A. Yes. Although that framework was developed under Title VII, the Commission and virtually all federal courts have applied some variant of the basic evidentiary framework developed in McDonnell Douglas to ADEA disparate treatment cases.5 Indeed, the Supreme Court used McDonnell Douglas in O'Connor. 9. Q. Is the McDonnell Douglas framework the exclusive means of assessing the evidence in a disparate treatment case? A. No. The McDonnell Douglas model is simply one way of assessing the evidence. For example, where there is direct evidence of discrimination, a determination on the merits can be made without relying on the McDonnell Douglas framework. For EEOC investigative purposes, however, the important consideration is that a determination on the merits should be made on the basis of whatever evidence has been obtained, without rigid or inflexible adherence to a prescribed "formula." As noted by the Seventh Circuit in Carson v. Bethlehem Steel Corp., regarding a Title VII prima facie case: "Any demonstration strong enough to support a judgment in the plaintiff's favor if the employer remains silent will do, even if the proof does not fit into a set of pigeonholes." 82 F.3d at 159. 10. Q. Does the O'Connor decision address the applicability of the adverse impact theory of discrimination in age cases? A. No. The case deals solely with the disparate treatment theory of discrimination. While the Supreme Court has never ruled on the applicability of the adverse impact theory to age cases,6 the majority of federal appellate courts have either held or assumed that the theory applies in age cases. The Commission applies the adverse impact analysis in age cases unless the law of the circuit prohibits such application. See 29 C.F.R. § 1625.7(d). 11. Q. Does the holding in O'Connor apply to pending cases? If a case is pending in a field office in the Fourth Circuit involving the replacement of one member of the protected age group by another member of the protected age group and the facts arose before the Supreme Court's decision, how should the field office proceed? A. The O'Connor decision does apply to pending cases. Therefore, field offices (including those in the Fourth Circuit) should apply the law as stated by the Supreme Court.7 If there are any questions concerning this memorandum or its application to a specific charge, EEOC investigative staff should contact their legal unit. 9/18/96 __________ ______________________________________________ Date Gilbert F. Casellas, Chairman 1. Although this enforcement guidance addresses this issue in the context of private sector discrimination charges, the principles and considerations discussed herein are equally applicable to federal sector complaints. With respect to the applicability of the guidance to charges/complaints brought under Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. § 2000e et seq.; the Americans with Disabilities Act of 1990, as amended, 42 U.S.C. § 12101 et seq.; and the Rehabilitation Act of 1973, as amended, 29 U.S.C. § 791 et seq., see discussion below at Question and Answer 2. 2. 67 EPD & 43,927, 70 FEP Cases 486 (1996). 3. In McDonnell Douglas Corp. v. Green, 411 U.S. 792 (1973) (Title VII), the Court held that a plaintiff can establish a prima facie case of disparate treatment in hiring by showing that: (i) he/she belongs to a protected class; (ii) he/she applied and was qualified for the job at issue; (iii) despite these qualifications, he/she was rejected; and (iv) after his/her rejection, the position remained open and the employer continued to seek applicants having the plaintiff's qualifications. 411 U.S. at 802. Courts have adjusted these criteria in analyzing the particular issue in dispute. For example, the prima facie case criteria for analyzing a hiring case differ slightly from those for analyzing a discharge or a denial of transfer case. 4. We note with approval that, in a recent post-O'Connor decision under Title VII, the Court of Appeals for the Seventh Circuit held that a plaintiff alleging racial discrimination in discharge need not show that her replacement was of a different race. Carson v. Bethlehem Steel Corp., 82 F.3d 157 (7th Cir.), 68 EPD & 44,009, 70 FEP Cases 921 (1996). 5. Relevant appellate court decisions applying McDonnell Douglas in an ADEA disparate treatment context are cited in O'Connor at 116 S. Ct. 1309-10 n.2. 6. See Hazen Paper Co. v. Biggins, 507 U.S. 604, 610 (1993). 7. For a discussion of the criteria that would preclude application of a Supreme Court decision to pending cases and, thus, limit it to prospective application, see Chevron Oil v. Huson, 404 U.S. 97, 106 (1971).
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