"But I'm Denny Crane!": age discrimination in the legal profession after Sidley.

• Author: Labriola, Donald J.

1. "TRUST ME. I CAN FIX THIS. I'M DENNY CRANE."

   Art doesn't always imitate life when it comes to the law. Boston Legal's aging TV lawyer Denny Crane may manage week after week to weasel out of predicaments that would cost younger men their jobs. (1) But real-world law firms have no sense of humor when an older worker's productivity begins to slip. When does the decision to discipline or terminate an employee because of perceived age-related debility violate the law? And what rights does an older worker have when faced with outright age discrimination?

   The answers to these questions are moving targets. As post-War America continues to gray, (2) its attitude toward older workers is becoming more tolerant. (3) Modern employment law has begun to challenge long-held practices in the legal profession, (4) where, unlike on TV, age-related dismissals are not limited to lawyers who shoot their clients. (5) When a veteran contributor begins to show signs of wear, many partners find themselves pressured to dismiss or demote a colleague who was once a skilled practitioner, a rainmaker, or even a mentor. (6) Such decisions may be difficult on a personal level, but the legal consequences can be worse. Competent older attorneys have long been harassed, terminated, passed over, or coerced into retirement for reasons rooted in greed, unthinking adherence to tradition, or stereotyping. (7) But today, any business decision that raises the specter of age discrimination is potentially actionable in federal and state courts. (8) Recent cases like Smith v. City of Jackson, Mississippi (9) and EEOC v. Sidley Austin Brown & Wood (10) have greatly extended the scope of legal protections against age bias (11) and made it plain that the profession will no longer tolerate age discrimination within its own ranks. (12) The result has been a new legal standard that has produced eight-figure consent decrees for practices that just a few decades ago might not have raised an eyebrow. (13)

2. FEDERAL AND STATE PROTECTIONS

   1. Statutory Overview

      The most important federal protections against workplace age discrimination are found in the Age Discrimination in Employment Act of 1967 ("ADEA"). (14) Enacted during the heady days following the 1964 Civil Rights Act, (15) the ADEA bars a broad range of discriminatory practices against employees who are at least forty years old. (16)

      Congress passed the ADEA because it found older workers to be at an increasing disadvantage in the workplace, facing inequities like unfair mandatory retirement policies, disproportionately high unemployment, and on-the-job discrimination. (17) In an introductory statement of purpose, it urged employers to base management decisions on merit, to adopt formal anti-discrimination policies, and to seek compromise solutions to age-related controversies. (18)

      The ADEA is effected by the Equal Employment Opportunity Commission, (19) a federal agency created by Title VII of the 1964 Civil Rights Act (20) that today has jurisdiction over most types of federal employment-discrimination claims. (21) Aggrieved employees normally must file a claim with the EEOC before they can open a civil case in federal district court. (22) If the agency fails to negotiate a conciliation, it issues a "right to sue" letter to the charging party (23) and may also file its own claim on the employee's behalf. (24)

      Procedures are slightly different (25) in states that complement ADEA protections with their own (generally more comprehensive) anti-discrimination laws and enforcement agencies. (26) New York is one such "deferral" state, (27) where the New York State Division of Human Rights (28) implements the New York State Human Rights Law (NYSHRL). (29) The NYSHRL grants New York residents legal recourse to a wide range of discriminatory activities. (30) Its workplace age-discrimination protections are similar to those of the ADEA, but extend to employees as young as eighteen and to employers with as few as four workers. (31) Many municipalities also create their own anti-discrimination statutes and enforcement entities, such as New York City's Human Rights Law (32) and Commission on Human Rights. (33)

      The ADEA, New York State Human Rights Law, and New York City Human Rights Law are especially important in "employment-at-will" states like New York, where employees can be terminated "at any time for any reason." (34) Without the at-will exceptions carved out by statutes like these, employees would have no legal defense against the most abusive employment practices.

   2. Who is Protected?

      The ADEA bars age discrimination against nearly all types of employees who are at least forty years old, (35) including job applicants and U.S. citizens employed overseas. (36)

      The ADEA does not, however, define the term "employee" with specificity. The circular statutory definition--an "individual employed by any employer"--is broad enough to be almost meaningless without interpretation by regulation or case law. (37) Guidance can be found in the 2002 case EEOC v. Sidley & Austin, (38) where the EEOC alleged that a prominent Chicago law firm had unfairly used age as the basis for summarily demoting thirty-two partners to non-equity positions. (39) In that case, Sidley argued that, by definition, a partner is an employer, not an employee, and thus not within the ADEA. (40) But the District Court disagreed, using the EEOC's multi-factor "common law agency" test (which looks to the actual nature of a job, rather than to an arbitrary title) to determine that most of Sidley's hundreds of "partners" lack sufficient control over the business to be considered employers. (41) The court thus refused to bar the partners from asserting rights under the ADEA for lack of standing. (42)

      The Seventh Circuit chose the same test upon appeal, (43) as did the Supreme Court one year later in Clackamas Gastroenterology Associates, P.C. v. Wells (44) to determine the employment status of disabled plaintiffs under the similarly worded Americans with Disabilities Act. (45) By the time Sidley petitioned the Supreme Court in 2006 to reconsider the Seventh Circuit's decision, the firm no longer even attempted to raise the issue of employer/employee status. (46)

      The implications of these decisions are profound, and especially so for the legal profession, where limited partnerships are common. After Sidley, it is clear that the ADEA bans discrimination against workers who hold merely nominal equity positions. If Denny Crane were fired by his fellow partners because of ostensibly age-related problems, he could still claim standing under the ADEA if he could show that he no longer held enough control over the business to be considered an employer under the common law agency test.

   3. Who is an "Employer"?

      The ADEA exerts jurisdiction over a broad spectrum of employers that include the federal government (47) (other than self-administering agencies like the Social Security Administration), (48) local municipalities, (49) and almost any type of private business entity (including employment agencies and labor organizations) with at least twenty employees. (50)

      It ostensibly bans discrimination by state governments, (51) but the Eleventh Amendment normally bars individuals from suing state agencies under federal law. (52) Congress can use its Fourteenth Amendment powers to abrogate this Eleventh Amendment immunity, but only when there is a "congruence and proportionality between the injury to be prevented or remedied and the means adopted to that end." (53)

      The Supreme Court applied this test to the ADEA in the 2000 age-discrimination case Kimel v. Florida Board of Regents. (54) Because age is not a suspect classification that would trigger heightened scrutiny, state employers may use it as a basis for classification schemes that are merely rationally related to a legitimate state interest. (55) The Kimel Court found that the ADEA prohibited state employment decisions and practices that are constitutional under this lenient "rational basis" equal-protection test. (56) The ADEA, the Court concluded, thus failed the "congruence and proportionality" test (57) and could not be applied to the states under the authority of the Fourteenth Amendment. (58)

      There are several exceptions to this rule. First, although limited in application, the Supreme Court has held that a private individual may under certain conditions bring suit to enjoin a public official from enforcing unconstitutional state regulations. (59) Furthermore, the Eleventh Amendment does not preclude an instrumentality of the federal government--such as the EEOC--from itself bringing suit against a state. (60)

   4. Scope of Protection

      The ADEA's ban against workplace age discrimination is similar to Title VII's expansive prohibitions against other types of employment bias, differing primarily in the basis of the discrimination it forbids. (61) It extends to every type of "term, condition, or privilege of employment" from recruitment through retirement, banning discriminatory practices in "hiring, firing, promotion, layoff, compensation, benefits, job assignments, and training." (62)

      The ADEA specifically prohibits job notices that state an age preference, (63) discriminatory entry requirements for apprenticeship programs, (64) and benefit plans that afford preferential treatment to younger workers (unless they do so merely to equalize costs across age groups). (65) It forbids retaliation against employees who have asserted their rights under the statute by filing a claim, participating in an investigation, or overtly opposing discriminatory practices. (66) The statute also requires employers to conspicuously post EEOC-approved notices that inform employees of these rights. (67)

3. THE MECHANICS OF AN AGE-DISCRIMINATION CLAIM

   1. Making a Claim

      An ADEA case is normally initiated by filing a claim with the EEOC between 60 and 180 days after the date of an alleged offense. (68) But in a deferral state...