EEOC Issues Final Regulations on Reasonable Factors Other Than Age

By Eric B. Meyer

Last month, the U.S. Equal Employment Opportunity Commission (EEOC) issued its “Final Regulation on Disparate Impact and Reasonable Factors Other than Age” (RFOA) under the Age Discrimination in Employment Act of 1967 (ADEA).

Wait, wha, wha, what the heck is an RFOA? (Here’s the Cliff Notes version because, like, you could click on the link above, dudes.)

Here’s what the EEOC had to say about the new rule in this press release:

The final rule clarifies that the ADEA prohibits policies and practices that have the effect of harming older individuals more than younger individuals, unless the employer can show that the policy or practice is based on a reasonable factor other than age. The rule explains the meaning of the RFOA defense to employees, employers, and courts, and makes EEOC’s regulations consistent with Supreme Court case law. The rule applies to private employers with 20 or more employees, state and local government employers, employment agencies, and labor organizations. The final rule strikes the appropriate balance between protecting older workers from discriminatory, unreasonable business decisions and preserving an employer’s ability to make reasonable business decisions.”

Is an employment practice based on age?

Is it just me, or did that snippet fail to clarify anything?

Let’s try something different. How about we turn to the EEOC’s “Questions and Answers on EEOC Final Rule on Disparate Impact and ‘Reasonable Factors Other Than Age’ Under the Age Discrimination in Employment Act of 1967″ —

8. What determines whether an employment practice is based on Reasonable Factors Other than Age?

An employment practice is based on an RFOA when it was reasonably designed and administered to achieve a legitimate business purpose in light of the circumstances, including its potential harm to older workers.

. . .

The rule emphasizes the need for an individualized consideration of the facts and circumstances surrounding the particular situation. It includes the following list of considerations relevant to assessing reasonableness:

The extent to which the factor is related to the employer’s stated business purpose;
The extent to which the employer defined the factor accurately and applied the factor fairly and accurately, including the extent to which managers and supervisors were given guidance or training about how to apply the factor and avoid discrimination;
The extent to which the employer limited supervisors’ discretion to assess employees subjectively, particularly where the criteria that the supervisors were asked to evaluate are known to be subject to negative age-based stereotypes;
The extent to which the employer assessed the adverse impact of its employment practice on older workers; and
The degree of the harm to individuals within the protected age group, in terms of both the extent of injury and the numbers of persons adversely affected, and the extent to which the employer took steps to reduce the harm, in light of the burden of undertaking such steps.

To establish the RFOA defense, an employer does not need to show that it considered each of these factors. The considerations merely describe the most common characteristics of reasonable practices. Similarly, if an employer demonstrates that it considered one or more factors listed above, it does not automatically establish the RFOA defense.

Make sense? Maybe sorta. It’ll have to do for now.

This was originally published on Eric B. Meyer’s blog, The Employer Handbook.