Background

This case centers around Kentucky's disability retirement plan, which provides benefits to state employees who become disabled before they become eligible for normal retirement "“ a milestone requiring an employee to either (a) put in twenty years of service or (b) reach age 55 with at least five years of service. Because the disability plan awards benefits based in part on how close a disabled worker is to reaching normal retirement (with the aim of providing the worker with the same retirement benefits he would have had if he continued to work until eligible for normal retirement), the plan affects older workers differently than younger workers. This case originated when the EEOC brought a claim on behalf of Charles Lickteig, a 61-year-old employee of the Jefferson County Sheriff's Department who claimed disability after nearly 18 years of service. Because he was over age 55 and thus eligible for normal retirement, he received normal retirement benefits based on his nearly 18 years of service; had he been under age 55 and thus not eligible for retirement, he would have received higher disability retirement benefits based on an imputed 20 years of service. The question presented is whether the use of age as a potential factor in the distribution of retirement benefits to disabled workers establishes a prima facie case of discrimination in violation of the Age Discrimination in Employment Act (ADEA).

Petitioners' Brief

Petitioners Kentucky Retirement Systems, the Commonwealth of Kentucky, and the Jefferson County Sheriff's Department present two principal arguments in their brief. First, they claim that Kentucky's disability plan does not violate the ADEA because it differentiates on the basis of employees' eligibility for normal retirement benefits, rather than on the basis of their age.

Specifically, they explain, Kentucky's disability retirement plan is structured as a "safety net" for workers who are unable to rely on normal retirement benefits. Relying on Hazen Paper Co. v. Biggins (1993), petitioners argue that "organizing a plan around eligibility for retirement is not the same as organizing a plan around age." Because it is permissible under the ADEA to base retirement eligibility on age, petitioners claim that the use of age as a potential factor in disability benefits does not make the plan facially discriminatory. They also argue from policy that the plan is rational because it provides more benefits for younger disabled workers who, because they have had less time to accumulate wealth for retirement, need more of a boost than older workers.

Petitioners turn to statutory interpretation for their second principal argument: only retirement plans which use age in an arbitrary manner can be considered discriminatory under the ADEA. By contrast, petitioners contend, Kentucky's plan rationally uses age only with respect to normal retirement benefits, which benefits most older workers. Petitioners allege that the ADEA was intended to fight "arbitrary" age discrimination based on inaccurate stereotypes about age. In that respect, they argue, the ADEA is unlike Title VII, under which any classification based on sex or race is considered facially discriminatory. Instead, a retirement plan is only facially discriminatory under the ADEA if it is arbitrary on its face. Consideration of age in a disability benefits plan cannot be arbitrary, petitioners contend, because it is a necessary component of any complement to a retirement system.

 Respondent's Brief

Respondent EEOC argues that Kentucky's disability retirement plan is facially discriminatory under the ADEA because it uses age-based criteria to pay benefits in a way that disadvantages some older disabled workers. Disagreeing with petitioners' view that the ADEA targets only purposeful discrimination based on ageist stereotypes, the EEOC contends that any explicit consideration of age constitutes facial discrimination. Unless an employer is covered by one of the ADEA's specific exceptions (such as for voluntary early retirement incentive plans) or defenses (such as cost-justification), use of age as a factor in determining benefits is a violation.

The EEOC also argues that Kentucky's use of age in calculating disability benefits is arbitrary. The state's proposed justification for disparate treatment "“ viz., that younger disabled workers "need more of a boost" "“ is based on "stereotypical assumptions of the kind the ADEA seeks to eradicate." The EEOC argues that the state's inability to provide non-stereotypical justifications for using age as a criterion underscores why employers must have the burden of defending facially discriminatory practices. The EEOC further argues that Congress reiterated this understanding when it passed the Older Workers Benefit Protection Act (OWBPA) to amend the ADEA, enacted as a response to the Court's 1989 decision in Public Employees Retirement System v. Betts. Finally, the EEOC argues that the Court should defer to EEOC regulations and guidance, which view benefit plans such as Kentucky's as discriminatory.

Amicus Briefs

Four amicus briefs have been filed in support of petitioners. Amici include 13 states and several government associations such as the National League of Cities and the National School Boards Association. These amici largely re-argue the merits and suggest that a ruling for the EEOC could jeopardize many public employee retirement systems across the country.

One amicus brief has been filed in support of respondent EEOC by AARP and the National Employment Lawyers Association. They mostly reiterate the points raised in the EEOC's brief and argue that liability under the ADEA does not depend on evidence that age-based discrimination is motivated by inaccurate or stigmatizing stereotypes.

Posted in Kentucky Retirement Systems v. EEOC, Everything Else