Eleventh Circuit Removes Protections for Older Job Applicants

November 18, 2016 - 18 minutes read

It’s a brave new world out there for older job applicants, and it’s likely one that Congress didn’t envision when it drafted the Age Discrimination in Employment Act (ADEA) in 1967. Structural changes in the workforce, changes in the recruiting industry, and technological innovations are giving rise to a more competitive environment for older applicants.  And even worse for those applicants, a recent en banc decision by the Atlanta-based U.S. Court of Appeals for the Eleventh Circuit in Villarreal v R.J. Reynolds Tobacco Co., No. 15-20602 (11th Cir. Oct. 6, 2016) will make it much more difficult for them to prove claims of disparate treatment and disparate impact for age-related discrimination.

Background

Today’s companies are constantly innovating, striving to be at the forefront of cutting edge developments in their fields, but all while trying to keep costs low.   It is no wonder then why recruiters are often tasked with hunting fresh-faced graduates while pushing aside older applicants. This is the reality that Richard Villarreal faced when he, a 49 year-old man, sought employment as a Territory Manager with R.J. Reynolds Tobacco Company six times over a five-year period.  The documents filed in the trial court suggest that RJR’s recruiting contractor first rejected his job applications based on RJR’s hiring guidelines for the position, which had described the “target candidate” as someone “2-3 years out of college” that “adjusts easily to changes”, but which also advised recruiters to “stay away from” applicants that were “in sales for 8-10 years.”  In later years, he was rejected by a different recruiting company who had been provided similar “resume review guidelines” from RJR and who even helped RJR develop a “Blue Chip” candidate profile, which stated that 67% of “Blue Chip” territory managers had no prior experience or 1-2 year of work experience, while only 9% had six or more years of prior experience.

Mr. Villarreal did not receive any offer from RJR and was not contacted by them in any capacity regarding his various applications. Mr. Villarreal was summarily rejected each time he applied, and the company hired individuals under the age of 40 on each occasion.  The discriminatory guidelines RJR had used to reject Mr. Villarreal’s applications did not come to his attention until he was informed by the lawyers who had contacted him after learning of the discriminatory practices.  (A lengthier discussion of the case background can be found in lower court filings, including the trial court’s order. See Order dated 03/06/2013, Dkt. No. 58 in No. 2:12-cv-0138 (N.D. Ga.)).

In Mr. Villarreal’s case, the company’s discriminatory practices were brought to his attention by a third party.  But most persons affected by similar forms of age-based discrimination likely won’t be fortunate enough to receive anything close to the clear information he received about possible age discrimination.

Disparate Treatment and Disparate Impact in Employment Litigation

Disparate impact discrimination occurs when a protected class of persons (i.e. race, sex, national origin, etc.) is shown to be disproportionately affected by an employer’s neutral policies or employment criteria. While the policies or criteria may appear facially neutral and non-discriminatory at a glance, they may ultimately be shown to have an unlawful pernicious effect on members of a protected group. Disparate impact claims are in contrast to claims of disparate treatment that allege that a defendant has engaged in an unlawful pattern or practice of intentional discrimination.

In cases of disparate impact, the employee often will not have any direct evidence of discrimination, but the employee may be permitted to prove his/her case by inference from statistical data. If the threshold burden of showing disparate impact is met, then the burden shifts to the employer to show that the practice is related to the job in question and has a legitimate business justification. Even if a defendant makes that showing, the plaintiff can still prevail in rebuttal by showing that other business practices that would have produced a less discriminatory result were considered by rejected by the defendant.

Villarreal Removes Older Job Applicants From Protection In Disparate Impact Cases

Older employees aged 40 and over are expressly protected by the ADEA. Like groups protected by Title VII of the Civil Rights Act of 1964, they too can prove claims of disparate treatment discrimination by proving discriminatory intent through circumstantial evidence of discrimination. The same is true for claims of disparate impact discrimination; under both Title VII of the Civil Rights Act of 1964 and the ADEA, current “employees” are expressly permitted to bring claims of disparate impact against their employers.

But in Villarreal, the Eleventh Circuit ruled that only “employees” in the strictest sense of the word—and not job applicants—can bring a disparate impact claim of employment discrimination under the ADEA.  This is in contrast to how the Equal Employment Opportunity Commission (EEOC) had interpreted the statute when it issued the multiple right to sue letters to the plaintiff based on his complaints.

In essence, the Eleventh Circuit held that the statutory language in question was ambiguous in light of its surrounding text. The problem specifically lies within Section 4(a) of the ADEA, which makes it unlawful for an employer:

(1) to fail or refuse to hire or to discharge any individual or otherwise discriminate against any individual with respect to his compensation, terms, conditions, or privileges of employment, because of such individual’s age; [or]

(2) to limit, segregate, or classify his employees in any way which would deprive or tend to deprive any individual of employment opportunities or otherwise adversely affect his status as an employee, because of such individual’s age.

The usage of the terms “employee” and “any individual” opened the text up to conflicting interpretations—one that disqualified job applicants as they were not technically “employees” and one that protected job applicants as they obviously fell under the broader term of “any individual.” Since the language was ambiguous, the plaintiff argued that the court should have deferred to the EEOC’s interpretation of the statutory language. Instead, however, the Eleventh Circuit ignored the ambiguity and declared that the text was clear and, therefore, job applicants like Mr. Villarreal were not covered by the ADEA.

Villarreal’s Ruling on Equitable Tolling Ignores Current Realities in Hiring and Recruitment

Mr. Villarreal’s other claims against the defendants for disparate treatment discrimination under ADEA did not fare as well either before the Eleventh Circuit, but for an entirely different (and perplexing) reason. Under ADEA, before a plaintiff files an age discrimination lawsuit, he or she must file a charge with the EEOC alleging unlawful discrimination within 180 days after the alleged unlawful practice occurred (or 300 days if governing state law also contains a similar prohibition on age discrimination). A plaintiff is typically held to this deadline unless he can prove a basis for a longer period to apply.

The court affirmed the trial court’s conclusion that Mr. Villarreal’s claims were time-barred and could not be saved by the continuing violations doctrine or equitable tolling. The court found that continuing violations doctrine did not apply because the discrete incidents of discrimination (e.g., the repeated refusals to hire him for the position) did not amount to a continuing violation. As for the issue of equitable tolling, the Court’s ruling was… well… let’s just say, divorced from reality, if not surreal:

Villarreal is not entitled to equitable tolling because he admitted facts that foreclose a finding of diligence. Specifically, he alleged that he did nothing for more than two years between his initial application and the communication from the lawyer. Villarreal argues that any inquiry would have been futile, but even assuming that futility is an exception to the diligence requirement, it would not apply when a plaintiff does nothing to investigate the status of his application, as opposed to the reasons for his rejection. We have no difficulty concluding, as a matter of law, that a plaintiff who does nothing for two years is not diligent.

Id. at *28. Let’s take a moment to take that in: The court said, in other words, because Plaintiff never followed up to determine why he hadn’t been hired, then he had essentially disqualified himself from complaining about the discrimination that he was later told about. In the court’s view, it didn’t matter that the plaintiff was unaware of any facts to suggest that he had been passed over because of his age. Rather, it was his obligation to investigate those circumstances in the first place. To put this in simple terms: Under this ruling, instead of job applicants presuming the best in people—that employers and recruiters aren’t prejudiced—it is now up to the applicants to launch full-scale investigations into each instance they are not hired or else they will lose any potential anti-discrimination claims. That seems like an absurd result.

Villarreal Is Worthy of Criticism; Lots of it. Don’t hold back.

The court’s decision in Villarreal is problematic on two fronts: by not only stripping protection from older applicants in disparate impact claims, but also by setting an unreasonable expectation on plaintiffs filing disparate treatment claims in regard to equitable tolling standards.

The problems stemming from a lack of disparate impact protections will only grow as the recruiting field continues its trend toward computer-assisted technology and opaque algorithms. Ever hear of corporate recruiters using bash scripts to sift through a pile of electronic resumes?  What about using brute-force keyword searches on LinkedIn to selectively target a universe of potential applicants?  Anyone who’s been in the orbit of mainstream recruiting in the last decade has heard of something like this.  After all, who can blame busy recruiters for trying to be more efficient?

With the convenience and exposure afforded by online job-postings, recruiters often find themselves flooded with prospective employees and have turned to algorithms to help sift out promising candidates – or, as the case may be, to weed out undesirable ones. While the application of such algorithms is becoming an increasing necessity, they pose a real danger of promoting discrimination in hiring practices.

Author and mathematician Cathy O’Neill cautions in a Harvard Business Review podcast that big-data algorithms are rarely audited for fairness or legality.  Mr. Villarreal’s case presents a cautionary example of just that.  If, say, recruiters use the Career Builder website to accept applications for a company’s position and later apply automated search terms to identify candidates that meet a company’s specified criteria, then they will be held liable for acts of discrimination to the same extent as the company.  This is because whatever algorithm, computer functionality, or business process that was used to filter resumes would not have taken into account matters like disparate impact or ADEA protections.  And like in the case of RJR, many recruiting processes are rarely policed to ensure that they do not discriminate on the basis of age until a problem arises.  The larger issue here — which really has little to do with Mr. Villarreal’s case but which is an increasing concern in our modern workplace — is that systems and algorithms that are modeled on existing hiring practices may result in patterns of discrimination that could give rise to disparate impact claims.

As for disparate treatment claims, the court’s ruling on equitable tolling in Villarreal imposes an unreasonable standard that plaintiffs in the Eleventh Circuit will need to meet going forward. Plaintiffs will need to cry disparate treatment early and often when they aren’t hired, lest they run the risk having their claims dismissed as untimely. As Judge Martin noted in her dissent, “[u]nder the majority’s new rule, no discrimination victim can get equitable tolling unless he assumes he was discriminated against, no matter how unreasonable the assumption might be,” and, in her view, “[such a] rigid test makes little sense.”  Indeed, Mr. Villarreal the court’s ruling indicates that it expected him to scrutinize and investigate why he was rejected for the position he applied for, in spite of the fact that he would never have known about the alleged discrimination had third parties not alerted him to the fact years later, long after the statutory deadline to file had lapsed. It is precisely situations like these that are contemplated by the equitable tolling doctrine, at least before Villarreal.

Between companies favoring young graduates and the usage of unregulated hiring algorithms, the outlook for older job applicants may seem bleak. The added burden of needing to worry about suing within a tight 180-day deadline will do no favors for busy job applicants and recruiters. Under the court’s impractical analysis, desperate job seekers must assume the burden of launching mini-investigations into each time they are passed-over in a hiring decision. Ultimately, the court’s decision in Villarreal exacerbates an already fraught area of law by stripping away existing protections for older job applicants and forcing them to meet a ridiculous standard of diligence, whether or not they are faced with potential discrimination in the first place. Tragically, the court’s ruling does little to protect older workers, which was the whole reason why Congress passed ADEA in the first place.

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The Moya Law Firm represents individuals and businesses alike in all aspects of civil litigation.  If you are a business wishing to review your recruiting practices or compliance systems to minimize your employment liability exposure, or if you are an individual who believes that you may have been discriminated against in your search for a job or promotion, please contact us using the form provided here.