Meacham and others sued their former employer, Knolls Atomic Power Lab, alleging that it violated the Age Discrimination in Employment Act (ADEA) when it terminated the plaintiffs' employment in an "involuntary reduction" in its work force. Employees were chosen for the reduction by means of a matrix that measured various factors, including "criticality" and "flexibility." 245 out of an estimated 2,063 eligible employees were placed on the matrices; thirty-one employees on the matrices were selected for layoff, thirty of whom were over forty years of age. The district court found that the plaintiffs could go forward with their case because they had made a sufficient showing that the reduction had a disparate impact on employees over the age of forty. The Second Circuit Court of Appeals affirmed on "business necessity" grounds, finding that the plaintiffs had alleged at least one alternative non-discriminatory method for achieving the reduction without having a disparate impact. This opinion was vacated and remanded by the Supreme Court for further consideration in light of Smith v. City of Jackson, Miss.
On remand, the Second Circuit reversed the district court and dismissed the plaintiffs' ADEA claim. In City of Jackson, the Supreme Court held that an employer is not liable under the ADEA so long as the challenged employment action, in relying on specific non-age factors, constitutes a reasonable means to the employer’s legitimate goals. The Second Circuit ruled that the plaintiffs bear the burden of persuading the court that the Lab's matrix was not a "reasonable means" to achieving its goal, and that the plaintiffs had failed to do so. The Second Circuit noted that the factors used in the Lab's reduction matrices could have been better drawn and that the process could have been better scrutinized to guard against a skewed layoff distribution. However, the Lab did set standards for managers constructing matrices and selecting employees for layoff, and it did monitor the implementation of the reduction plan. Accordingly, the reduction plan was "reasonable."
The Age Discrimination in Employment Act (ADEA) prohibits employment practices that have an unjustified disparate impact on older workers, Smith v. City of Jackson, Miss., 544 U.S. 22 (2005), but also provides that it "shall not be unlawful for an employer . . . to take any action otherwise prohibited . . . where the differentiation is based on reasonable factors other than age." 29 U.S.C. § 623(f)(1).
The questions presented are:
1. Whether an employee alleging disparate impact under the ADEA bears the burden of persuasion on the "reasonable factors other than age" defense, as held by the Second Circuit in this case in conflict with the decisions of other circuits and a regulation of the Equal Employment Opportunity Commission.
2. Whether respondents' practice of conferring broad discretionary authority upon individual managers to decide which employees to lay off during a reduction in force constituted a "reasonable factor other than age" as a matter of law.