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ADEA Given Broader Reach than Title VII: Supreme Court Rules ADEA Covers Political Subdivisions with Less than 20 Employees

By: Rachel Berry, Sara Robertson, and Elizabeth Gross

On Tuesday November 6, 2018, the U.S. Supreme Court unanimously ruled that the Age Discrimination in Employment Act (“ADEA”) applies to state and local government employers with fewer than 20 employees.  The Supreme Court’s decision, in Mount Lemmon Fire District v. Guido, affirmed the U.S. Ninth Circuit Court of Appeal’s ruling and resolved a Circuit Court split regarding the ADEA’s coverage of public employers.

Due to budgetary shortfalls, the Mount Lemmon Fire District, a political subdivision in Arizona, terminated its two oldest full-time firefighters, John Guido and Dennis Rankin, who sued alleging discrimination under the ADEA. Mount Lemmon sought dismissal of the case on the grounds that it was not an employer as defined and  covered by the ADEA.

Upon enactment in 1967, the ADEA covered only private sector employers.  However, in 1974, Congress amended the ADEA to redefine an employer as “a person engaged in an industry affecting commerce who has twenty or more employees…[t]he term also means (1) any agent of such a person, and (2) a State or political subdivision of a State…”  (emphasis added).

The statutory language proved pivotal in the case, as the Supreme Court held the phrase “also means” created an entirely new, separate category of employer covered under the ADEA. The Supreme Court reasoned that because Congress did not apply the numerosity requirement of private sector employers to the political subdivisions, small state and local government subdivisions need not have 20 or more employees to fall within the ADEA’s scope.

While Mount Lemmon warned that this interpretation would too broadly extend the ADEA’s scope, potentially causing increased litigation and legal costs and threatening necessary public services, the Supreme Court ultimately disagreed. Justice Ruth Bader Ginsburg, who authored the opinion, acknowledged that this interpretation would give the ADEA “a broader reach than Title VII. But this disparity is a consequence of the different language Congress chose to employ.”  The Court was further unconcerned with the risk of emergency service shrinkages, noting that the Equal Employment Opportunity Commission has followed this same interpretation for 30 years without problematic public services cuts.  The Court concluded that the ADEA’s definition of employer left “scant room for doubt” that state and local governments are employers under the ADEA, regardless of their number of employees.

With its broader reach, state and local employers should be mindful of the ADEA’s coverage and requirements. The Polsinelli Labor and Employment attorneys are here to address and assist with any ADEA questions or cases.