Commission v. Allstate Insurance ( 2008 )

SHEPHERD, Circuit Judge,

dissenting.

I would find that the EEOC’s challenge to the rehire policy falls under section 29 U.S.C. § 623(a)(1), not (a)(2), and is, therefore, not susceptible to a disparate impact claim. Here, the majority observes that Allstate had terminated all employee-agents as of June 30, 2000; that Allstate did not have a policy that restricted the rehire of its former employee-agents between June 2000 and September 2000; and that, during that three-month period, Allstate hired three former employee agents into non-agent positions. Ante at 1044, n. 2. The facts, as stated by the majority, demonstrate that at the time Allstate put the rehire policy in place, the individuals affected by it were not Allstate employees.

I have been unable to find a single case that supports the majority’s conclusion that section 623(a)(2) applies when former employees challenge their former employer’s policy that came into existence after their termination. Rather, only employees may rely on either subjection of section 623(a)(2). Smith v. City of Des Moines, Iowa, 99 F.3d 1466, 1470 n. 2 (8th Cir.1996). The former Allstate employees affected by the rehire policy could only be applicants for employment, not employees, and, thus, the EEOC is limited to relying on section 623(a)(1) to challenge the policy. Id.; see Leftwich v. Harris-Stowe State Coll., 702 F.2d 686, 689-90 (8th Cir.1983) (applying section 623(a)(1) where terminated professor, who was a faculty member of the college prior to transfer to state college system brought suit under the ADEA challenging his exclusion from the “new” college’s faculty); Gaskey v. Fulton Bellows, LLC, No. 3:05-CV-540, 2007 WL 869621, at *5 (E.D.Tenn. Mar.20, 2007) (unpublished) (applying section 623(a)(1) to former employees’ claim that former employer’s refusal to rehire them had a disparate impact on older applicants in violation of the ADEA).

In Leftwich, as here, the individuals impacted by the employer policy at issue were terminated prior to the inception of the challenged policy, and the policy purportedly restricted the individuals from obtaining another position with their former employer in violation of the ADEA. 702 F.2d at 689-90. This court, in discussing Leftwich, characterized it as a case “involving an applicant....” City of Des Moines, 99 F.3d at 1470 n. 2. It follows that the EEOC’s characterization of this case as one that involves the classification of Allstate employees in such a way that disqualifies them for rehire and is, thus, actionable under section 623(a)(2) fails. Instead, it is one in which the EEOC is challenging an employer’s policy that impacts potential applicants for employment. Accordingly, section 623(a)(1) applies.¹⁰

In view of this conclusion, the question becomes whether the EEOC can pursue a disparate impact claim under section 623(a)(1). Both the district court and the majority determined that Smith v. City of Jackson, Miss., 544 U.S. 228, 125 S.Ct. 1536, 161 L.Ed.2d 410 (2005), precludes the EEOC from doing so; the EEOC concedes this point. In City of Jackson, a plurality of the Court stated that section 623(a)(1) “does not encompass disparate-impact liability ...,” indicating that section 623(a)(2) does. Id. at 236 n. 6, 125 S.Ct. 1536. Justice O’Connor’s concurrence, joined by Justices Kennedy and Thomas, stated that they would find “that disparate impact claims are not cognizable under the ADEA.” Id. at 248, 125 S.Ct. 1536 (O’Connor, J., concurring). Therefore, after City of Jackson, the source of disparate impact liability under section 623(a), if any, is subsection (a)(2) alone. Section 623(a)(1) claims, like this one, cannot establish liability on a disparate impact theory.¹¹

In sum, the EEOC’s challenge to Allstate’s restriction on the rehire of former employees falls only under section 623(a)(1), a provision that does not allow recovery under a disparate impact theory of liability. Thus, the district court erred in partially granting the EEOC’s motion for partial summary judgment. I would reverse the district court and grant Allstate’s partial motion for summary judgment.

10 . The ADEA defines "employee” as "an individual employed by any employer.” 29 U.S.C. § 630(f). As the EEOC points out, in the context of Title VII, the Supreme Court has found that the term "employees” includes former employees. Robinson v. Shell Oil Co., 519 U.S. 337, 345-46, 117 S.Ct. 843, 136 L.Ed.2d 808 (1997). The EEOC asserts that, because the ADEA defines employee in a similar manner, Robinson’s broad construction of the term applies to section 623(a)(2). However, the EEOC has offered no support for this position. Furthermore, while “[s]ection 623(a)(2) of the ADEA governs employer conduct with respect to 'employees’ only, ... the parallel provision of Title VII protects 'employees or applicants for employment.' ” Smith v. City of Des Moines, Iowa, 99 F.3d 1466, 1470 n. 2 (8th Cir.1996) (citing 29 U.S.C. § 623(a)(2); 42 U.S.C. § 2000e-2(a)(2)). Accordingly, the construction of section 623(a)(2) need not mirror that of the parallel Title VII provision. These key textual differences between the two provisions coupled with a complete lack of precedent for the EEOC’s position persuades me that the term "employees” in section 632(a)(2) does not include former employees.

11 . I note that this court’s implicit determination in Leftwich v. Harris-Stowe State Coll., 702 F.2d 686 (8th Cir. 1983) that a disparate impact analysis is applicable to section 623(a)(1), id. at 690, as well as this court’s statement in City of Des Moines that applicants may, pursuant to section 623(a)(1), bring disparate impact claims, 99 F.3d at 1470 n. 2, have been abrogated by Smith v. City of Jackson, Miss., 544 U.S. 228, 125 S.Ct. 1536, 161 L.Ed.2d 410 (2005).