By Mimi Henninger, SPHR,
Senior Human Resources Consultant
AmeriBen/IEC Group Exlporer,
According to recent statistics released by the Equal Employment Opportunity Commission (EEOC), overall discrimination claims rose 15% in 2008 from 2007. One reason for an increase in discrimination claims is that more people are being laid off from their jobs. A certain percentage of affected employees will file discrimination claims.
Interestingly, age discrimination claims rose at a much higher rate (29%) over the same period. Employers may unintentionally be targeting older workers for several reasons. There may be a desire to layoff the more highly-compensated employees in order to cut costs. This can have a greater impact on older workers. Older workers also have a harder time finding a new job. This gives them more time to dwell on the situation and focus on filing a discrimination claim rather than moving on to a new job and a new employer.
What can you do to minimize your risk of discrimination claims during a reduction in force and specifically, minimize the risk of age discrimination claims?
Perhaps the best way to minimize legal exposure when implementing a reduction in force is to document your decision making and implementation processes.
• Decide on the business goals of the layoff. How many positions will be cut and what departments will be affected?
• What is your criteria for selecting employees for lay off? The criteria you use needs to be consistent and objective.
• Make sure you have documentation that supports your selection decisions.
• Conduct a disparate impact analysis to determine if the lay offs affected any protected class of workers disproportionately. Make adjustments as necessary to the lay off selection list to avoid an adverse impact on any protected groups.
The decision to reduce your work force is difficult. Proper planning and documentation can ensure that you do not end up spending all the savings you gained in a layoff on defending a discrimination claim. For more information on this topic, please contact the Resource Center at [email protected]
— Information courtesy of AmeriBen/IEC Group Exlporer: About AmeriBen: As a full-service TPA with 50 years of administration experience, AmeriBen/IEC Group (“AmeriBen”) is the largest group in the Northwest possessing both human resource consulting and benefit administration services. AmeriBen currently administers benefit plans for nearly 100 employers and universities numbering 170,000 participant and student lives. Our Retirement Benefits Department administers more than 200 defined contribution retirement plans while our Human Resource Consulting customer base numbers over 400 employers. In total, AmeriBen has approximately 700 clients.