Age Discrimination Case Dismissed

Discussion of potential pension benefits not enough to warrant age discrimination claim.

Church Law and Tax 1996-07-01

Employment Practices

Key point. Churches can dismiss employees over 40 years of age if age is not a determining factor. Generally, this means that churches can dismiss employees over 40 years of age as a result of economic conditions.

A Michigan court dismissed an age discrimination lawsuit brought against a Catholic church and archdiocese by a 62—year—old employee who was dismissed as a result of economic conditions. In 1991 the number of families in a Catholic parish declined from 1,500 to 1,250. This decline led to a deficit of $200,000. A CPA firm was called in to conduct a financial study and organizational analysis, and it recommended that the parish reorganize its staff and consolidate responsibilities. The pastor of the church responded by terminating five employees including the plaintiff (a 62—year—old custodian); a 40—year—old religious education secretary; a 31—year—old director of religious education; a 63—year—old school librarian; and a 68—year—old school secretary. The dismissed custodian sued the church and archdiocese, claiming that his dismissal violated a state civil rights law banning age discrimination in employment. He relied on the pastor’s testimony that his decision to dismiss the custodian was based in part on the fact that the dismissed custodian would be able to retain his pension and medical benefits while two other custodians who were not dismissed would not. A state appeals court concluded that the pastor’s consideration of the custodian’s eligibility for retirement and medical benefits did not automatically constitute unlawful age discrimination. It noted that in an age discrimination case the plaintiff has the burden of proving a “prima facie case” of discrimination by a preponderance of the evidence. It concluded that the custodian failed to meet this burden of proof, noting that “the mere fact that plaintiff was eligible for a pension is not enough for this court to infer age discrimination.” As support for its decision the court referred to a recent ruling by the United States Supreme Court finding that an employer did not engage in unlawful age discrimination when it dismissed an employee a few weeks before his pension benefits vested. The Supreme Court observed:

It is the very essence of age discrimination for an older employee to be fired because the employer believes that productivity and competence decline with old age …. When the employer’s decision is wholly motivated by factors other than age, the problem of inaccurate and stigmatizing stereotypes disappears. This is true even if the motivating factor is correlated with age, as pension status typically is. Hazen Paper Co. v. Biggens, 113 S. Ct. 1701 (1993).

The court pointed to a second basis for its decision: “When an employer lays off employees for economic reasons, the employee bears a greater burden of proof in establishing discrimination. In such a case, the employee must present evidence that age was a determining factor in the decision to discharge him. At best, plaintiff has offered evidence that his pension eligibility played some part in [the pastor’s] decision to terminate him rather than the other two maintenance workers. Plaintiff has made no showing that his pension eligibility—and therefore, in plaintiff’s argument, his age—was a determining factor in that decision.” Plieth v. St. Raymond Church, 534 N.W.2d 164 (Mich. App. 1995). [ Labor Laws]

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