State and federal laws prohibit companies from discriminating against workers because of their age. The Age Discrimination in Employment Act, or ADEA, is a federal law that protects workers older than 40 from unfavorable treatment based on their age. The ADEA covers all government and private employers with more than 20 workers. It is illegal for a company to discriminate against older workers in any terms, conditions and privileges of employment, including hiring, firing, promotion, pay, benefits, assignments and training. Employers who discriminate against older workers may face government investigations and private lawsuits by victims of discrimination.
Under the ADEA, an employer cannot set an age limit or preference for a job unless it can show that being under a certain age is a "bona fide occupational qualification" that is reasonably necessary to the successful operation of the business. Accordingly, courts permit employers to establish age limits for airline pilots, air traffic controllers, police officers and bus drivers because there is some research to suggest that the ability to perform these occupations decreases with age.
To succeed in a claim under the ADEA, a worker must be able to prove that his age is the motivating factor behind the employer's decision to take adverse action against him, such as firing, demotion, or a decrease in pay. In Smith versus the City of Jackson, the U.S. Supreme Court held that a worker cannot succeed in an ADEA case by proving that an employer's policy had a "disparate impact" on older individuals. Disparate impact refers to a practice that is neutral on its face, but has an unfair negative impact on members of a protected class. This makes the ADEA somewhat narrower than other anti-discrimination statutes, which allow plaintiffs to sue under a disparate impact theory.
In addition to the ADEA, Congress also passed the Older Worker Benefits Protection Act, or OWBPA, which amended the ADEA to prohibit employers from denying benefits to older employees. This statute allows employers to reduce benefits based on age, but only to the extent that the cost of providing reduced benefits to older employees is equal to the cost of providing benefits to younger workers. This law also protects older employees from being coerced into waiving their legal rights to sue under the ADEA. To be valid, a waiver of rights must be in writing; must specifically refer to ADEA rights; must exclude future claims; and must be revocable for seven days after it is signed, among other requirements.
Although age discrimination is difficult to prove, discrimination claims continue to rise. In 2010, the Equal Employment Opportunity Commission received 23,264 complaints of age discrimination, compared to only 16,008 a decade earlier. An employee who proves age discrimination in court can receive a number of remedies, including back pay, or compensation for the time he was wrongfully out of work; front pay, or compensation for anticipated future losses; reinstatement to his position; and attorney’s fees.