In a 5-4 opinion written by Justice Clarence Thomas, the US Supreme Court held that unlike under Title VII, where a plaintiff can prevail if he or she shows that race, sex or some other protected class was a “motivating factor” in the employer’s actions, a plaintiff suing for age discrimination under federal law must prove that the employer would not have treated him or her adversely “but for” age, and the burden never shifts to the employer to show that it would have taken the same action regardless of age. Gross v. FBL Financial Services, Inc., 2009 WL 1685684 (US 2009).

Jack Gross began working for FBL Financial Group, Inc. (FBL), in 1971. As of 2001, he held the position of claims administration director. But in 2003, when he was 54 years old, Gross was reassigned to the position of claims project coordinator. At that same time, FBL transferred many of Gross' job responsibilities to a newly created position – claims administration manager. That position was given to Lisa Kneeskern, who had previously been supervised by Gross and who was then in her early 40s. Although Gross (in his new position) and Kneeskern received the same compensation, Gross considered the reassignment a demotion because of FBL's reallocation of his former job responsibilities to Kneeskern.

In April 2004, Gross filed suit in the US District Court for the Southern District of Iowa, alleging that his reassignment to the position of claims project coordinator violated the Age Discrimination in Employment Act (ADEA), which makes it unlawful for an employer to take adverse action against an employee “because of such individual's age.” The case proceeded to trial, where Gross introduced evidence suggesting that his reassignment was based at least in part on his age. FBL defended its decision on the grounds that Gross' reassignment was part of a corporate restructuring and that Gross' new position was better suited to his skills.

At the close of trial, and over FBL's objections, the district court instructed the jury that it must return a verdict for Gross if he proved, by a preponderance of the evidence, that FBL “demoted [him] to claims projec[t] coordinator” and that his “age was a motivating factor” in FBL's decision to demote him. The jury was further instructed that Gross' age would qualify as a “motivating factor, if [it] played a part or a role in [FBL]'s decision to demote [him].” The jury was also instructed regarding FBL's burden of proof. According to the district court, the “verdict must be for [FBL] ... if it has been proved by the preponderance of the evidence that [FBL] would have demoted [Gross] regardless of his age.” The jury returned a verdict for Gross, awarding him $46,945 in lost compensation.

FBL challenged the jury instructions on appeal. The US Court of Appeals for the Eighth Circuit reversed and remanded for a new trial, holding that the jury had been incorrectly instructed under the standard established in Price Waterhouse v. Hopkins,490 US 228 (1989). In Price Waterhouse, the Supreme Court addressed the proper allocation of the burden of persuasion in cases brought under Title VII of the Civil Rights Act of 1964, when an employee alleges that he suffered an adverse employment action because of both permissible and impermissible considerations- i.e., a “mixed-motives” case. Although the decision was splintered, six of the nine justices ultimately agreed that if a Title VII plaintiff shows that discrimination was a “motivating” or a “ ‘substantial’ ” factor in the employer's action, the burden of persuasion should shift to the employer to show that it would have taken the same action regardless of that impermissible consideration.

Applying that standard, the Eighth Circuit found that Gross needed to present “[d]irect evidence ... sufficient to support a finding by a reasonable fact finder that an illegitimate criterion actually motivated the adverse employment action.” In the appellate court’s view, “direct evidence” is only that evidence that “show[s] a specific link between the alleged discriminatory animus and the challenged decision.” Only upon a presentation of such evidence, the Eighth Circuit held, should the burden shift to the employer “to convince the trier of fact that it is more likely than not that the decision would have been the same absent consideration of the illegitimate factor.” The court of appeals thus concluded that the trial judge’s jury instructions were flawed because they allowed the burden to shift to FBL upon a presentation of a preponderance of any category of evidence showing that age was a motivating factor-not just “direct evidence” related to FBL's alleged consideration of age. Because Gross conceded that he had not presented direct evidence of discrimination, the Eighth Circuit Court of Appeals held that the district court should not have given the mixed-motives instruction. Rather, Gross should have been held to the burden of persuasion applicable to typical, non-mixed-motives claims; the jury thus should have been instructed only to determine whether Gross had carried his burden of “prov[ing] that age was the determining factor in FBL's employment action.”

The US Supreme Court agreed to review the case.  The parties asked the Court to decide whether a plaintiff must “present direct evidence of discrimination in order to obtain a mixed-motive instruction in a non-Title VII discrimination case.” Before reaching that question, the Court first determined whether the burden of persuasion ever shifts to the party defending an alleged mixed-motives discrimination claim brought under the ADEA.  Gross relied on the Supreme Court's decisions construing Title VII for his interpretation of the ADEA. In response, the Court reasoned that “[b]ecause Title VII is materially different with respect to the relevant burden of persuasion . . . these decisions do not control our construction of the ADEA.”  After Price Waterhouse was decided, Congress amended Title VII by explicitly authorizing discrimination claims in which an improper consideration was “a motivating factor” for an adverse employment decision. However, the Supreme Court has never held that this burden-shifting framework applies to ADEA claims. Unlike Title VII, the ADEA's text does not provide that a plaintiff may establish discrimination by showing that age was simply a motivating factor. Moreover, Congress neglected to add such a provision to the ADEA when it amended Title VII to add such language even though it contemporaneously amended the ADEA in several ways.  According to the Court, “[w]e cannot ignore Congress' decision to amend Title VII's relevant provisions but not make similar changes to the ADEA. When Congress amends one statutory provision but not another, it is presumed to have acted intentionally.”

The Court therefore focused on the text of the ADEA to decide whether it authorizes a mixed-motives age discrimination claim. The ADEA provides, in relevant part, that “[i]t shall be unlawful for an employer ... 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.”  Citing several dictionaries, the Court held that the words “because of” mean “by reason of: on account of.” Thus, the ordinary meaning of the ADEA's requirement that an employer took adverse action “because of” age is that age was the “reason” that the employer decided to act. “To establish a disparate-treatment claim under the plain language of the ADEA, therefore, a plaintiff must prove that age was the ‘but-for’ cause of the employer's adverse decision.”

Accordingly, the Court held that “under the ADEA, the plaintiff retains the burden of persuasion to establish that age was the ‘but-for’ cause of the employer's adverse action. And nothing in the statute's text indicates that Congress carved out an exception to that rule for a subset of ADEA cases” involving alleged mixed motives. Hence, it ruled that “the burden of persuasion necessary to establish employer liability is the same in alleged mixed-motives cases as in any other ADEA disparate-treatment action. A plaintiff must prove by a preponderance of the evidence (which may be direct or circumstantial), that age was the ‘but-for’ cause of the challenged employer decision.”   The burden of persuasion does not shift to the employer to show that it would have taken the action regardless of age, even when a plaintiff has produced some evidence that age was one motivating factor in that decision. Accordingly, the Court vacated the judgment of the Court of Appeals and remanded the case for further proceedings.

The Gross case was somewhat surprising to both the management and the plaintiffs’ bar.  Many did not think the Supreme Court would go as far as it did in deciding not to apply the burden shifting analysis in mixed motive age discrimination cases.  However, it remains to be seen whether the decision will make it easier for employers to defend age discrimination claims, and whether Congress will seek to amend the ADEA like it amended Title VII.

The Arent Fox Labor and Employment Law Group has substantial experience in defending age discrimination claims. If you have any questions about this decision, please feel free to contact us.

Michael L. Stevens
stevens.michael@arentfox.com
202.857.6382