Starbucks announced it is closing 600 stores. American Airlines announced it is laying off 900 flight attendants. Polaroid is shutting down two manufacturing plants. The computer chip maker AMD is cutting 10% of its workforce. From coffee to cameras, to computers to planes, people across all industries are facing mass layoffs and the potential to lose their jobs.
As an employment lawyer, I always advise companies that the only safe way to conduct a layoff is to follow this simple rule: “Last hired, first fired.” Defense attorneys love this way of selecting employees for layoff, because it is objective. There no way for discriminatory motives and biases to creep into a system that is based solely on dates of hire.
But do companies use “Last hired, first fired”? Usually not. Sometimes the cuts are spread among various departments; a new worker in a crucial department keeps her job, while a longtime employee in an expendable department loses his job. Or take Starbucks, as an example. When Starbucks closes 600 stores, all the employees at each of the 600 stores should get a pink slip. But the CEO, Howard Schultz, has said that it will try to find work at its other stores for as many of the displaced employees as possible. That’s where Starbucks and other companies usually do not follow the “Last hired, first fired” rule. Employees with long tenures at the company will get passed over for jobs at other stores. Newer employees with less experience will get hired into nearby Starbucks locations that remained open.
Why does this happen? (Keep in mind that Starbucks is just a theoretical example here). The companies will say it’s based on “job performance.” Yet, how is a newer, less experienced employee with far less training able to outperform a long term employee? Job skill is rarely the real reason that long term employees are left unemployed while new employees keep their jobs.
Often times the real answer is that the decision maker just “likes” the newer employee better. People tend to hire people who remind them of themselves. The corollary is that people do no hire, or retain, employees who do not remind them of themselves. If the reason that an employee does not remind the hiring manager of themselves has to do with a protected class – such as the employee is of a different age, different race, is disabled, is a different gender – then this very human tendency to hire people like ourselves is not just a human tendency; its illegal discrimination.
How Can You Show the Reason Was Illegal Age Discrimination?
One of the main ways displaced worker show that they were not hired, or not retained, because of their age is through suspicious timing of employee discipline. Boeing is one company who learned this lesson the hard way in a real case that serves as an excellent example.
Real Lawsuit: Eileen McKee worked at Boeing for 30 years. But she didn’t retire. Even with all that seniority she was laid off. Here’s what happened.
Boeing announced that it would be laying off employees from many different departments. Eileen worked in a human resources related department with one other (younger) employee and one manager. Eileen wasn’t nervous about the layoffs because she had more seniority and also had a history of positive appraisals from her manager.
At the same time Boeing announced the layoffs, however, the company also announced that it would use a new employee rating system “to compare employees in comparable positions.” The new system labeled Eileen and her co-worker as “comparable” even though their job duties did not overlap. Her co-worker was also female, but was 36 years old. Using the new rating system, Elieen’s manger gave Eileen a score of 17. Eileen’s manager gave the younger co-worker a score of 39. As a result, Boeing laid off Eileen and retained the younger, less experienced co-worker.
Eileen immediately filed a state law age discrimination claim, but lost. She did not give up. Next she filed a age discrimination lawsuit in federal court under the Age Discrimination in Employment Act (ADEA). Boeing tried hard to keep Eileen from getting her case in front of a jury. The company filed a motion for summary judgment, in which the it asks the court to throw out Eileen’s case, arguing that she did not have any evidence that she was selected for layoff due to her age.
But the court did not throw out Eileen’s case. In fact, the court just allowed Eileen’s case to go to a jury trial. Eileen defeated Boeing’s summary judgment motion by arguing that her evidence of age bias was the rapid change in her performance rating, from all positive for years to a low score of 17 on the new employee rating system. Less than a year before she got a poor rating, Eileen’s same manager gave her a “glowing” performance appraisal. Suspiciously, the area in the glowing appraisal where Eileen scored the highest was at first included in the new ratings system, but was later removed. Although this one change would not have given Eileen a higher score than her younger co-worker, it was strange enough that the judge ruled that a jury could conclude the change was done in order to give the older worker, Eileen, a lower score. (Cotter v. Boeing Co., E.D. Pa. No. 05-5053, 6/26/07).
The Undercover Lawyer’s Take-Away-Tips:
1. Be Highly Suspicious of Any Sudden Change in Your Evaluations, or the a Change in the Evaluation System. These sudden changes appear to outsiders like a calculated plan to get rid of the people whose performance ratings suddenly go down. Why does the company suddenly decide to get rid of employees who have historically performed well? Is it age? Gender? Race? If you can show that your performance could not be the “real reason” you were demoted or laid off, then a judge or jury will quickly make a connection between your termination and your age. In Eileen’s case, the judge said that the “change in criteria, in the absence of a reasonable explanation, may raise an adverse inference that the change was initiated to adversely handicap [Eileen's] final score.”
2. Push hard to keep your appraisals at least “satisfactory”. Many, if not most, companies use a 1 to 5 rating scale, where 5 is excellent and 1 is consistent failure to meet expectations. A score of “3” is usually labeled “satisfactory.” Now, be aware that your manager may believe in their mind that a 3 out of 5 is a very bad score. But if the appraisal form says that a score of 3 is “satisfactory”, then guess was a jury is going think a score of “3” means? That’s right, your performance was satisfactory — good enough, competent, acceptable. If you can keep your performance reviews at this level, then it will be much more difficult for your employer to suddenly claim that your performance is the “real reason” you were demoted or laid off. And you will be well on your way to defeating a false case against you and having a strong age bias claim.