Labor & Employment Law Daily Casino employees get second chance on their ‘sex-plus-age’ claims under Title VII
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Thursday, July 23, 2020

Casino employees get second chance on their ‘sex-plus-age’ claims under Title VII

By Wayne D. Garris, Jr.

The employees, who were terminated as part of a mass layoff by the casino’s new owner, alleged that older women and all employees over 40 were targeted during the layoff.

The Tenth Circuit affirmed in part and reversed in part the district court’s dismissal of the Title VII and ADEA disparate impact and disparate treatment claims of nine former casino employees who alleged that they were targeted during a mass layoff due to their age and sex. Reversing the dismissal of their Title VII disparate impact claim, the court relied on the Supreme Court’s recent decision in Bostock v. Clayton Cty., Ga., and held that a plaintiff alleging sex-plus discrimination under Title VII does not need to show discrimination against a subclass of men and women; but only need show that she would not have been terminated if she had been a man. However, the employees failed to put forth enough evidence of discrimination to sustain their sex-plus-age disparate impact claim. The court also reversed dismissal of the employees’ disparate impact and disparate treatment ADEA claims based on data showing that older employees were disproportionately discharged and younger employees were disproportionately retained or hired (Frappied v. Affinity Gaming Black Hawk, LLC, July 21, 2020, Lucero, C.).

Mass layoff. In January 2013, the employer, a casino operator, laid off many of its employees and posted for 59 open positions. The plaintiffs, eight women and one man all over the age of 40, filed suit alleging that the employer laid off employees in a discriminatory manner. The female employees brought “sex plus age” disparate impact and disparate treatment claims under Title VII. All nine employees alleged disparate impact and disparate treatment under the ADEA.

The district court granted the employer’s motion to dismiss the Title VII sex-plus-age claims and the ADEA disparate impact claim. It also denied plaintiffs’ motion for reconsideration of the disparate impact ADEA claim. Additionally, the court granted summary judgment for the employer on the remaining disparate treatment ADEA claim. The employees appealed.

“Sex plus” discrimination. Title VII prohibits discrimination based on a combination of protected characteristics—in this case sex-plus-age discrimination. In Coleman v. B-G Maintenance Management of Colorado, Inc., the Tenth Circuit held in order to prevail on a sex-plus claim, a female plaintiff had to prove that the subclass of women to which she belonged “was unfavorably treated as compared to the corresponding subclass of men.” However, in Bostock, the Supreme Court stated that courts are required to focus on individual discrimination. As a result, the court abandoned the Coleman standard and held that a sex-plus plaintiff only needs to show that she would not have been terminated but for her sex.

Disparate impact. In this case, the appeals court held that sex-plus-age claims are cognizable under Title VII. The employer argued that employees should not be able to bring this claim because the ADEA provides relief for age discrimination. But the court rejected this argument, stating that “[a]n ADEA claim addresses discrimination against an older worker because of his or her age, whereas a Title VII sex-plus-age claim brought by an older woman addresses discrimination against her because of her sex.” Because the district court dismissed the Title VII disparate impact claim solely on the ground that the employees could not bring sex-plus-age claims under Title VII, and because the employer did not oppose on any other grounds, the appeals court reversed dismissal of this claim.

Title VII disparate treatment. The district court dismissed the Title VII disparate treatment claim, holding, again, that sex-plus-age claims were not recognized by Title VII. The court also reasoned that the employees failed to specify the age at which one is an “older woman,” and they failed to put forth sufficient allegations of sex discrimination. Since the appeals court already held that sex-plus-age claims could be brought under Title VII, it addressed the remaining two justifications.

“Older women.” Although the court held that sex-plus plaintiffs no longer had to show discrimination targeting a particular subclass, they still had to identify the “plus-” characteristic on which they based their claims. In their complaint, the employees repeatedly referred to the female plaintiffs as “forty or older.” Although the complaint did not explicitly state that age was the plus characteristic, the employees allege that the claim was being brought on behalf of “older women.” The appeals court concluded that, while not ideal, the complaint sufficiently alleged that the “plus” category was age for purposes of the motion to dismiss.

Adequately pled. The employees’ disparate treatment claim ultimately failed, however, because they failed to adequately allege that any individual plaintiff, or the group, was terminated because of sex. Other than the statistical allegations in the complaint, the only allegations concerning discrimination against older women as compared to older men were assertions that the employer’s actions “had a discriminatory impact on older workers, and older females in particular,” and that the employer “viewed older females unfavorably and/or graded older females more harshly than… older males.” These allegations were too conclusory to sustain the claim, the appeals court found.

The employees also provided statistical data, along with p-values, to show the likelihood that the employer’s basis for terminating older women was not random. However, the plaintiffs failed to compare older women to older men when analyzing the data and calculating the p-value. Thus, the data only established that age and sex could have been the reason for their termination, but it did not address the sex-plus-age allegation. Because the non-statistical allegations were too conclusory and because the statistical data failed to compare older women to older men only, the court affirmed dismissal of the Title VII sex-plus-age disparate treatment claim.

ADEA disparate impact. The district court found that the employees identified specific age-neutral employment policies, but that they failed to offer statistics or data on the alleged disparate impact of those claims. The employees submitted data showing that the employer laid of 67% of its employees over 40 and laid off 48% or 49% of it employees under 40. The court was persuaded by the p-value for the age-based data which showed that there was only a 4.784% chance that the correlation between age and termination was the product of random chance.

In addition to the statistical evidence, the employees put forth evidence to show that the majority of new hires made after the layoffs were in their twenties. Based on this evidence, the court reversed the dismissal of the ADEA disparate impact claim.

ADEA disparate treatment. The employer argued that the employees could not prove that they were replaced by younger hires because employees were grouped by position so there were no direct replacements. However, the appeals court stated that the McDonnell-Douglas framework could be adapted to the facts of this case, and the employees only had to show that older employees were terminated while younger employees were retained or hired.

The employees provided data showing the median ages, by job title, of the discharged employees and new hires. The data showed that the difference between the median ages of new hires and discharged employees ranged from 12 years to 29 years within the job titles. This gap was sufficient to give rise to an inference of age discrimination, as the Tenth Circuit has held that 10 years was sufficient for such a finding. Thus, the employees established their prima facie case.

The employer provided legitimate, nondiscriminatory reasons for each termination, such as attendance issues, violations of company policy, rudeness to customers, performance deficiencies, and attitude problems. However, the employees put forth sufficient evidence to show that these reasons were pretextual. First, when each plaintiff was terminated, their personnel files merely indicated a failure to pass the introductory period—the first 90 days after the employer took ownership of the casino. None of the personnel files indicated any other reason. Next, the employer provided a spreadsheet which purportedly listed the reasons for each termination; however, that list was inconsistent with the reasons provided at summary judgment. Lastly, there was no evidence that the employer used objective criteria to evaluate its employees. Thus, the court reversed summary judgment on the ADEA disparate treatment claim.

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