United States: Mandatory Backpay In ADEA Claims: What Will SCOTUS Decide?

Baltimore County has petitioned the Supreme Court to decide whether backpay for violations of the Age Discrimination in Employment Act ("ADEA") is mandatory.

Background

In 1999, two Baltimore County Correctional Officers initiated charges at the Equal Employment Opportunity Commission ("EEOC") claiming that they were being discriminated against based on their ages because they had to contribute more to the County's pension plan than younger employees. After years of litigation and various appeals in the U.S. District Court of Maryland and the Fourth Circuit Court of Appeals, in April 2016, Baltimore County and the EEOC entered into a Joint Consent Order to equalize pension member contribution rates.

After this Order was entered, the EEOC moved the District Court of Maryland to award retroactive and prospective monetary relief. The District Court declined to award this relief and held that backpay was not a mandatory remedy under the ADEA.

On appeal, in September 2018, the Fourth Circuit, in a distinct break from other Circuit Court rulings, reversed this finding and held that backpay is a mandatory legal remedy for violations of the ADEA.

Petition to Supreme Court

On December 13, 2018, Baltimore County filed a Petition for Writ of Certiorari to the Supreme Court on this issue. On May 24, 2019, briefing was completed. The Court will now have to decide if it is going to take up this issue.

Potential Implications

For the time being, employers in the Fourth Circuit should be operating under the assumption that any violation of the ADEA will result in mandatory backpay to an aggrieved employee, thereby making the stakes for these claims potentially much higher. Employers should continue ensuring that they are implementing and enforcing a thorough anti-discrimination policy, as well as complying with all ADEA requirements as a part of settlement and severance agreements as to avoid any substantial backpay awards.

We will continue to monitor whether the Supreme Court decides to take up this case.

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