Labor & Employment Law Daily In collective action accusing IBM of scheming to push out Boomers, plaintiffs denied court-assisted notices to 13K individuals,
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Wednesday, March 18, 2020

In collective action accusing IBM of scheming to push out Boomers, plaintiffs denied court-assisted notices to 13K individuals,

By Marjorie Johnson, J.D.

The named plaintiffs made no showing that a “unifying scheme” at the company linked the potential collective members to one another despite the vast differences in their jobs, locations, and circumstances surrounding their departure.

A group of former older IBM employees who claimed the tech giant laid off or otherwise forced out its older workers in a systematic effort to replace them with “Millennials” were denied their motion for a court-facilitated notice of their collective ADEA action to almost 13,000 former employees who, during the relevant time period, were over 40 years old when their employment ended either due to “layoff, discharge, or voluntarily—and thus may have been constructively discharged.” A federal district court in New York ruled that the plaintiffs failed to show that a discriminatory nationwide policy or plan “infected all of IBM’s employment separation decisions, regardless of the context or circumstances of separation.” However, aggrieved former employees could still pursue their ADEA rights by opting into the lawsuit or filing suit independently (Rusis v. International Business Machines Corp., March 10, 2020, Caproni, V.).

IBM’s complex business organization is divided into multiple groups and sub-units with thousands of teams and currently has three main business segments. The four former employees who brought this action worked in various jobs and locations across the United States until their separation in 2018. They most recently held positions as global commodity manager, solution manager for global system integrator alliances, second line manager of the asset management organization, and senior IT specialist.

Seeking competitive advantage. The employees alleged that IBM, in a companywide effort to replace older employees with younger hires, discriminated against workers in all segments of the company across all job classifications across the entire nation by forcing them to depart because of their advanced age. They claimed that IBM’s policy and practice was part of a strategic program to better compete with rivals in the emerging technology sectors of cloud services, big data analytics, mobile security, and social media, internally referred to as “CAMS.”

ProPublica article. To demonstrate this illegal policy, the employees pointed toaProPublica article which reported that IBM believed that “CAMS are driven by Millennial traits” and “sought to sharply increase hiring of people born after 1980.” In an unflattering comparison between “Baby Boomer” employees and employees from younger generations, an internal IBM report from 2006 referred to the former as “gray hairs” and “old heads” and stated that “successor generations are generally much more innovative.”

Various methods to push out Boomers. IBM allegedly used several methods to replace older workers with younger ones, including terminating them for pretextual reasons, constructively discharging them, or unfairly imposing unreasonable conditions upon them. This included requiring them to choose between relocating and retirement, or requiring them to develop new skills and then discharging them without identifying their skill deficit. The company also purportedly gave inaccurate performance reviews, imposed unobtainable quotas, and engged in practices used to train younger employees before pushing out the older employees.

Modest burden at notice stage. In determining whether to require an employer to provide the names and contact information for potential class members at the notice stage in a collective ADEA action, plaintiffs need to make the “modest factual showing” that others “may” be similarly situated to them. This means showing that the potential opt-in plaintiffs were victims of the same common policy or plan that violated the law.

No common policy. The proposed nationwide collective would have included almost 13,000 individuals, which could contain one or even several groups of individuals who were similarly situated to each other. However, the plaintiffs failed tie all of them to a common policy or plan. Indeed, none of the cases they cited provided for notice to as vast a group, but instead restricted the collective in terms of job category, a specific reduction-in-force or a specific means of discharge (such as constructive discharge). They also made no showing that a “unifying scheme” at the company linked the potential collective members to one another despite the vast differences in their jobs, locations, and circumstances surrounding their departure.

Affidavits from 15 former employees described separate incidents of alleged age discrimination at a different location, division, seniority level, and job function, apparently by different decisionmakers. While they all concluded with a copy-and-paste assertion alleging they believed other others had or would lose their jobs based on their “conversations with other current and former IBM employees,” such “vague allusions” to conversations with coworkers cannot support conditional certification. The plaintiffs also submitted the affidavit of a VP which could support notice to a collective comprised of former employees she oversaw based on her knowledge of statistics suggesting discriminatory layoffs, but it did not support nationwide certification.

Article doesn’t support conditional certification. The court also declined to rely on the ProPublica article as its critique of IBM’s employment practices was based only on a “subjective synthesis of various statistics, IBM documents, and employee statements by individuals whose journalistic credentials were unknown.” And the article’s assertion that there was an effort to “correct [the] seniority mix” at IBM was based on an undated internal presentation and could have meant the company was “balancing inexperienced with experienced employees to maintain a range of seniority in the talent pool for purposes of rational succession planning.”

Two documents cited in the article also did not demonstrate a nationwide policy to discriminate against older workers. First, the internal company document that used the terms “gray hairs” and “old heads,” predated the notice period by more than a decade. Second, the document that was presented at 2014 conference titled “Reinvention in the Age of the Millennial,” contained no evidence of bias in its pronouncements that IBM should “embrace the ‘Millennial mindset.’”

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