The Age Discrimination in Employment Act and the Older Workers Benefits Protection Act: Protections for Employees Over 40
The Age Discrimination in Employment Act of 1967 (ADEA) protects employees and job applicants age 40 and older from discrimination based on age in hiring, discharge, promotion, compensation, or other terms, conditions or privileges of employment. The Older Workers Benefit Protection Act (OWBPA), an amendment to the ADEA, specifically prohibits employers from denying benefits to older employees, despite the increased costs of providing benefits to employees as they age.
Prohibitions on Age Discrimination
Enforced by the Equal Employment Opportunity Commission, the ADEA applies to private employers with 20 or more employees, employment agencies, labor organizations, and state, local and federal governments. The purpose of the ADEA and the OWBPA is to promote employment of older workers based on their ability and skill, while protecting them from any form of discrimination or denial of benefits based on their age. As Congress observed in Section 2 of the ADEA, older workers often find themselves disadvantaged in their efforts to retain employment or to regain employment after being displaced from their jobs. 29 U.S.C. § 621. The ADEA sought to level the playing field for olders workers.
Under the ADEA, it is therefore unlawful to discriminate against a person over 40 because of his or her age with respect to any term, condition, or privilege of employment, including hiring, firing, promotion, layoff, compensation, benefits, job assignments, and training. Harassing an older worker because of age is also prohibited.
Specifically, Section 4 of the ADEA makes it unlawful for an employer unlawful to:
- Fail or refuse to hire or discharge any person or otherwise discriminate against any individual with respect to terms, conditions, compensation, or privileges of employment due to the individual’s age;
- Reduce the wage rate of any employee based on age; or
- Limit or classify employees in a way that would deprive or potentially deprive them of employment opportunities.
See 29 U.S.C. § 623. The ADEA also applies to employment agencies, making it unlawful for them to:
- Fail or refuse to refer for employment, or otherwise discriminate against any individual based on age, or classify or refer any individual for employment based on the individual’s age.
See 29 U.S.C. § 623(b). The ADEA also applies to labor organizations, making it unlawful for them to:
- Exclude or expel from membership, or otherwise discriminated against due to an individual’s age; or
- Limit, segregate, or classify its membership, or fail or refuse to refer employment in a way that would deprive or tend to deprive any individual of employment opportunities, because of the individual’s age.
See 42 U.S.C. § 623(c). It’s worth noting that the ADEA does allow employers and other applicable entities to favor older workers based on age even when doing so adversely affects a younger worker who is 40 or older. In other words, employers are allowed to discriminate against young employees based on their age.
Protection from Retaliation
Importantly, the ADEA also makes it unlawful to retaliate against an individual for opposing employment practices that discriminate based on age, or for filing an age discrimination charge, testifying, or participating in any way in an investigation, proceeding, or litigation under the ADEA. 29 U.S.C. § 623(d).
The ADEA also includes a variety of specific protections for older workers in employment advertisements and job notices, apprenticeship programs, and pre-employment inquiries (although there is no prohibition on an employer asking an applicant’s age or date of birth as part of the application process).
Advertisements and Job Notices
The ADEA generally makes it unlawful for an employer to include age preferences, specifications or any limitations to job notices or advertisements. 29 U.S.C. § 623(e).
The ADEA also generally makes it unlawful for apprenticeship programs to discriminate on the basis of age.
The ADEA does not specifically prohibit employers from asking an applicant’s date of birth or age. However, an employer’s inquiry about applicants’ ages may disparately impact older workers by discouraging them from applying, or may indicate a possible intent by the employer to discriminate based on age, inconsistent with the requirements of the ADEA.
Regulations interpreting the provisions of the ADEA are available here:
Benefits for older workers are protected under the OWBPA amendment to the ADEA, which generally prohibits employers from denying benefits to older employees based on their age. This is a significant protection, as the cost of providing benefits to older employees is generally greater than the cost of providing the same benefits to younger employees. Congress recognized the financial implications of this protection, expressing a concern that the greater costs associated with older workers may create a disincentive for employers to hire older workers. Under limited circumstances, therefore, employers may be permitted to reduce certain benefits based on a worker’s age, provided the cost the employer incurs to provide those benefits to older workers is no less than the cost of providing the benefits to younger workers.
Waivers of ADEA Claims or Rights
The ADEA and OWBPA also set out specific requirements that permit waivers of age discrimination claims or rights in certain circumstances. For example, employers sometimes offer to pay departing employees a severance payment if the employee will sign an agreement waiving any legal claims he or she might have against the employer, including age discrimination claims under the ADEA. Similarly, an employee might enter into a settlement agreement with her employer to resolve a potential age discrimination claim. Under the OWBPA, for an ADEA waiver to be valid, the waiver must meet minimum standards to be considered “knowing and voluntary.” Among other requirements, a valid ADEA waiver must:
- Be in understandable writing;
- Refer specifically to ADEA rights or claims;
- Be in exchange for valuable consideration in addition to anything of value to which the employee was already entitled;
- Not waive rights or claims that may arise in the future;
- Advise the employee in writing to consult an attorney before signing the waiver;
- Provide the employee with a certain amount of time to consider the agreement before signing — for individual agreements, at least 21 days, for “group” waiver agreements, at least 45 days, and for any settlements of ADEA discrimination claims, a “reasonable” amount of time.
See 29 U.S.C. § 626(f). If an employer requests an ADEA waiver in connection with a reduction in force — such as an exit incentive or other employment termination program involving a group, the minimum requirements for a valid waiver are more extensive. The EEOC has issued a detailed policy document describing the requirements for valid waivers under these circumstances, titled “Understanding Waivers of Discrimination Claims in Employee Severance Agreements.”
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