The U.S. Supreme Court recently held in Gross v. FBL Financial Services, Inc .1that a plaintiff alleging a claim of age discrimination must, in all cases, prove by a preponderance of the evidence that age was the "but-for" cause of the challenged adverse employment action. In other words, the employee always has the burden to establish that the employer would not have taken the adverse employment action were it not for the employee's age. Before Gross , courts across the country in "mixed-motive" cases under the Age Discrimination in Employment Act ("ADEA")2had adopted and applied the burden-shifting approach to liability that applied in "mixed-motive" Title VII cases prior to the enactment of the Civil Rights Act of 1991. Under this approach, a plaintiff need not establish that an employer's impermissible consideration of a protected characteristic was the only or primary reason for an adverse employment action. Instead, it was sufficient for the employee to prove that an impermissible consideration played some role in the employer's decision, even if permissible considerations also were involved. If an employee could make that showing, the employer could avoid liability if it could prove that it would have made the same adverse decision anyway. In Gross , the Supreme Court rejected that burden-shifting approach in "mixed-motive" ADEA cases, holding that an employer is never required to prove that a challenged employment action would have occurred regardless of the employee's age.
Background: Price Waterhouse And The Civil Rights Act Of 1991
In 1989, the U.S. Supreme Court held in the seminal case Price Waterhouse v. Hopkins 3that an employer could escape liability in a Title VII case, even if an impermissible motive was involved in an employment action, if the same decision would have been made regardless of the impermissible motive. In Price Waterhouse , a female candidate for partnership at an accounting firm alleged that her employer violated Title VII by denying her partnership because she was a woman. Price Waterhouse first had delayed for one year a decision on making Hopkins partner, then denied her candidacy outright. Hopkins had an aggressive personality, and at trial the company presented evidence that Hopkins' demeanor and rough dealings with company staff weighed heavily against her chance of making partner. However, there was also evidence that some partners at the firm reacted negatively to Hopkins' aggressive personality merely because she was a woman. For example, a partner at the firm explained to Hopkins that to improve her chances for partnership, she should "walk more femininely, talk more femininely, dress more femininely, wear make-up, have her hair styled, and wear jewelry."4A plurality of the Supreme Court and two concurring Justices agreed that the plaintiff had established all that she must under Title VII by showing that the employer relied upon stereotypical notions of how female employees should look or act in coming to its decision (i.e., "sex-stereotyping"). This was so even though permissible considerations - Hopkins' rough treatment of staff - also played a role.5
But the plaintiff's showing that Price Waterhouse relied on sex-based considerations did not end the matter. The Supreme Court went on to hold that, even though the plaintiff demonstrated that her sex influenced the partnership decision, Price Waterhouse would not be liable if it could prove that it would have come to the same conclusion had sex not been considered.6Writing separately in a concurrence, Justice O'Connor added, in her view, "in order to justify shifting the burden on the issue of causation to the defendant, a disparate treatment plaintiff must show by direct evidence that an illegitimate criterion was a substantial factor in the decision."7Justice O'Connor believed that Hopkins had met this direct-evidence/substantial-factor standard because performance evaluations overtly referred to Hopkins' failure to conform to gender stereotypes as weighing against her chance at partnership.
In 1991, just two years after the Supreme Court decided Price Waterhouse , Congress passed the Civil Rights Act of 1991. The Civil Rights Act amended Title VII in two important ways. First, it amended Title VII to provide that it is sufficient to establish liability if a protected characteristic was a "motivating factor" in an adverse employment decision.8This marked a shift from Price Waterhouse , under which a plaintiff similarly had to show only that a protected characteristic was a "motivating factor" in an employment decision, but liability would not attach unless and until the employer failed to establish that it would have followed the same course anyway. Under the Civil Rights Act, even if the employer would have made the same decision absent the impermissible consideration, the decision will be found to be discriminatory.
Second, the Civil Rights Act preserved the "same-decision defense," but only as a limit on the remedies available to a plaintiff, and not as a defense to liability.9One issue left unresolved by the Civil Rights Act was the nature of proof required to show that an unlawful consideration motivated an otherwise lawful employment action. In Price Waterhouse , Justice O'Connor wrote that direct evidence was required.10After the passage of the Civil Rights Act, courts were divided as to whether Justice O'Connor's "direct evidence" requirement should apply to "mixed-motive" claims under Title VII. In 2003, in Desert Palace, Inc. v. Costa ,11the Supreme Court resolved this issue, holding that direct evidence of an improper consideration is not required under Title VII.
Although the Civil Rights Act also amended the ADEA, Congress did not add a provision to the text of the ADEA - as it did with Title VII - providing that a plaintiff could establish a claim of age discrimination if a protected characteristic was a "motivating factor" in an adverse employment decision. Therefore, after 1991, courts across the country in ADEA "mixed-motive" cases continued to adopt and apply the burden-shifting approach to liability set forth in Price Waterhouse .12That is the background against which Gross was decided.
The Gross Case
The Petitioner, Jack Gross, began working for FBL Financial Group, Inc. ("FBL") in 1971. In 2001, Gross held the position of "Claims Administration Director." In 2003, when Gross was 54 years old, he was reassigned to the position of "Claims Project Coordinator." Although Gross did not receive a decrease in his salary, Gross considered this reassignment a demotion because many of his job responsibilities were transferred to a newly created position, which was filled by a younger employee who Gross formerly supervised. Gross sued FBL, alleging that he was reassigned because of his age in violation of the ADEA.
At trial, Gross conceded that there was no direct evidence of FBL's discriminatory motive. However, the Court found that Gross presented ample circumstantial evidence that his reassignment was motivated, at least in part, by his age. Among other things, there was evidence that (1) Gross was highly qualified for the position to which his younger colleague was assigned; (2) the younger colleague was "far less" qualified for that job; and (3) Gross never was given the opportunity to apply for the position to which his former subordinate was assigned.13On the basis of this circumstantial evidence, the trial judge instructed the jury that Gross had the burden to prove that Gross's age was "a motivating factor" in FBL's decision to demote Gross to Claims Project Coordinator, but that it must return a verdict for FBL "'if it has been proved by a preponderance of the evidence that defendant would have demoted plaintiff regardless of his age.'"14Applying this instruction, the jury reached a verdict in Gross's favor and awarded him lost wages.
On appeal, the Eighth Circuit held that the trial court's jury instruction was flawed. The problem with the instruction was that the trial court failed to distinguish between the types of evidence that Gross could use to support his "mixed-motive" claim. In the Eighth Circuit, Justice O'Connor's concurrence in Price Waterhouse is considered to be the controlling opinion. Therefore, the Eighth Circuit held that in order to be entitled to a "mixed-motive" jury instruction Gross should have been required to present "direct evidence" that a protected characteristic played a "substantial" role in FBL's decision.15Gross argued that Desert Palace - which held that direct evidence is not required under Title VII, as amended by the Civil Rights Act of 1991 - superseded the continued application of a "direct evidence" requirement in ADEA cases. The Eighth Circuit rejected that argument, holding that the trial court wrongly presented the "mixed-motive" instruction based on Gross's circumstantial evidence alone.16
On appeal to the U.S. Supreme Court, the parties presented the question of whether Gross, as a plaintiff in a non-Title VII discrimination case, should have been entitled to the "mixed-motive" burden-shifting jury instruction based on his presentation of exclusively circumstantial evidence of discrimination. Rather than answer that question, the Court instead addressed what it considered to be an essential question preliminary to its analysis - whether the "mixed-motive" burden-shifting approach to liability is applicable in ADEA cases at all. The Court held that it is not. Rather, in all cases, the plaintiff bringing an ADEA claim retains the burden to show by a preponderance of the evidence that age was the "but for" cause of the employer's adverse employment decision.
The court offered several justifications for its conclusion. First, Title VII, as amended by the Civil Rights Act of 1991, is "materially different" from the ADEA with respect to the burden of persuasion, and therefore the Court's interpretation of the ADEA would not be governed by Title VII decisions such as Price Waterhouse and Desert Palace . If Congress intended for Title VII and the ADEA to be decided under the same standards, Congress would have amended the ADEA in 1991 to include a burden-shifting approach.17Second, the Court found that the text of the ADEA did not support burden-shifting.18Third, the Court rejected the argument that the ADEA should be interpreted consistently with Price Waterhouse . The Court questioned whether it would take the same approach to Title VII if it was to consider the question today for the first time, and noted that "even if Price Waterhouse was doctrinally sound," the rule from that case has proved difficult to apply. "[T]he problems associated with its application have eliminated any perceivable benefit to extending its framework to ADEA claims."19
Gross is a favorable opinion for employers because it heightens the proof requirement at trial for age discrimination plaintiffs. Prior to Gross , courts continued to apply the Price Waterhouse approach in ADEA cases. Under Price Waterhouse , an employee could satisfy his or her burden by showing that age was one factor among several for an adverse employment action, although not the main reason. The burden then would shift to the employer to avoid liability by proving that it would have taken the same action without considering the plaintiff's age. After Gross , the plaintiff retains the burden to prove that age was the "but-for" cause of the challenged employment action.
In addition to making it less onerous for employers to defend age discrimination claims, the Gross decision may confuse juries who will be instructed to apply competing standards in cases involving both ADEA claims and Title VII "mixed-motive" claims. This potential for confusion could benefit employers if it causes the plaintiffs' bar to forego combining ADEA and Title VII "mixed-motive" claims in the same case in favor of ostensibly less complicated deliberations following a trial. This issue also may arise in cases involving claims under both the ADEA and state anti-discrimination laws (which often are interpreted consistently with their federal counterparts).
Whatever the short-term impact of Gross may be, the decision is expected to be short-lived. Congress already has set in motion a process that may result in an amendment to the ADEA. On June 18, 2009 - less than two weeks after Gross was decided - U.S. Representative George Miller (D-CA), the chairman of the House Education and Labor Committee, announced that he intends to hold a hearing which could result in legislation reversing the Gross decision. And on September 29, 2009, Senate Judiciary Committee Chairman Patrick Leahy (D-Vt.) announced that the Judiciary Committee also will hold a hearing to examine Gross , at which Jack Gross is scheduled to testify. On October 6, 2009, both the U.S. House of Representatives and U.S. Senate introduced proposed legislation which would permit the "motivating factor" standard of the Civil Rights Act, including the "same-decision defense" only as a limit on a plaintiff's remedies, to apply to claims of age discrimination.
From a practical perspective, employers should not view Gross as a signal to modify existing practices. Although Gross will benefit employers during litigation, the substantive requirements of the ADEA remain unchanged. An employer may not take adverse employment action against an individual "because of" the individual's age. Under Gross , the burden of proving that an employment action was "because of" age remains at all times with the plaintiff, including where legitimate factors also played a role in the decision. Regardless of who bears this burden of proof, employers should continue to ensure that employment practices comport with legitimate business justifications. 1 129 S. Ct. 2343 (2009).
2 29 U.S.C. §§ 621-634.
3 490 U.S. 228 (1989).
4 Id . at 235.
5 Id . at 241-42.
6 Id . at 242. The standard adopted in Price Waterhouse is the approach adopted by the U.S. Supreme Court in Mt. Healthy City School District Board of Education v. Doyle, 429 U.S. 274 (1976). Mt. Healthy involved a claim by an untenured teacher that the school district violated his First Amendment rights when it refused to rehire him based, in part, on comments he made to a radio program about certain school policies. But the plaintiff also had engaged in other inappropriate behavior which weighed against his continued employment with the school. The Court held that it was the plaintiff's burden to show that his conduct was constitutionally protected and that this protected conduct "was a 'substantial factor' or to put it in other words, that it was a 'motivating factor' in the Board's decision not to rehire him." 429 U.S. at 287. The defendant then would be given the opportunity to avoid liability by proving by a preponderance that it would have reached the same decision in the absence of protected conduct. Id .
7 490 U.S. at 276.
8 42 U.S.C. § 2000e-(2)m (stating that "an unlawful employment practice is established when the complaining party demonstrates that race, color, religion, sex, or national origin was a motivating factor for any employment practice, even though other factors also motivated the practice.") (emphasis added).
9 "On a claim in which an individual proves a violation under section 2000e-2(m) of this title and a respondent demonstrates that the respondent would have taken the same action in the absence of the impermissible motivating factor, the court-(i) may grant declaratory relief, injunctive relief (except as provided in clause (ii)), and attorney's fees and costs demonstrated to be directly attributable only to the pursuit of a claim under section 2000e-2(m) of this title; and (ii) shall not award damages or issue an order requiring any admission, reinstatement, hiring, promotion, or payment, described in subparagraph (A)." 42 U.S.C. § 2000e-5(g)(2)(B).
10 490 U.S. at 276.
11 539 U.S. 90, 101 (2003).
12 See Febres v. Challenger Caribbean Corp ., 214 F.3d 57 (1st Cir. 2000); Ostrowski v. Atl. Mut. Ins. Cos ., 968 F.2d 171 (2d Cir. 1992); Starceski v. Westinghouse Elec. Corp., 54 F.3d 1089 (3d Cir. 1995); EEOC v. Warfield-Rohr Casket Co . , 364 F.3d 160 (4th Cir. 2004); Rachid v. Jack In The Box, Inc. , 376 F.3d 305 (5th Cir. 2004); Wexler v. White's Fine Furniture, Inc ., 317 F.3d 564 (6th Cir. 2003); Visser v. Packer Eng. Assocs., Inc . , 924 F.2d 655 (7th Cir. 1991) (en banc); Hutson v. McDonnell Douglas Corp ., 63 F.3d 771 (8th Cir. 1995); Lewis v. YMCA, 208 F.3d 1303 (11th Cir. 2000) (per curiam).
13 No. 4:04-CV-60209, 2006 WL 615670, at **5-6 (S.D. Iowa June 23, 2006).
14 526 F.3d 356, 360 (8th Cir. 2008) (quoting Final Jury Instruction No. 11).
15 Id . at 359 (citing 490 U.S. at 275 (O'Connor, J., concurring)).
16 Id . at 362.
17 129 S. Ct. at 2348-49.
18 Id . at 2350.
19 Id . at 2352.
Daniel J. Venditti is an Associate in the Litigation department of Weil Gotshal & Manges LLP and a member of the Employment Litigation Group. Please refer to our website at www.metrocorpcounsel.com for the footnotes to this article.