Definition of Decisional Unit Under ADEA

[AgedPerson]

Jurisdiction

New York

Suppose a company is terminating a number of employees all from a given large group that is comprised of several different departments, with each department headed by a different manager. The company is required by the ADEA to define the "Decisional Unit" from which the "terminated" employees were chosen, to define the "criteria for selection" for the termination, and to provide the ages of the terminated and non-terminated employees. The purpose of providing the age related data is to give the terminated employees the ability to determine if there was a disparate impact against older workers. My question is: Does the ADEA provide the company the flexibility to define a Decisional Unit and criteria for selection for each department, even though the termination action was coordinated at the level of the larger group?

I believe the answer is unequivocally "no". Aside from asking the company for the data associated with the larger group, is the only way to get the data to file a lawsuit?

 

[Tax Counsel]

My question is: Does the ADEA provide the company the flexibility to define a Decisional Unit and criteria for selection for each department, even though the termination action was coordinated at the level of the larger group?

I believe the answer is unequivocally "no". Aside from asking the company for the data associated with the larger group, is the only way to get the data to file a lawsuit?

Is the company asking the employees who are being terminated to sign a waiver of their right to sue for wrongful termination? The information requirements to which you refer only apply if the employer is laying off a group of people and are asking for waivers of their right to sue.

The EEOC regulations on this state that "A 'decisional unit' is that portion of the employer's organizational structure from which the employer chose the persons who would be offered consideration for the signing of a waiver and those who would not be offered consideration for the signing of a waiver." 29 CFR § 1625.22(f)(3)(i)(B). The unit is therefore the group of employees from whom the terminated employees were selected and is not based on the level in the organization that ultimately approved the termination decisions. The regulations provide that

For purposes of this section, higher level review of termination decisions generally will not change the size of the decisional unit unless the reviewing process alters its scope. For example, review by the Human Resources Department to monitor compliance with discrimination laws does not affect the decisional unit. Similarly, when a regional manager in charge of more than one facility reviews the termination decisions regarding one of those facilities, the review does not alter the decisional unit, which remains the one facility under consideration.
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29 CFR § 1625.22(f)(3)(vi)(A). That said, whether all the departments facing lay offs are together one decisional unit or are each a separate decisional unit will depend on the details of how the lay off is being done. Was the lay off for all them part of the same lay off decision with the same requirements applied to each or was each department doing separate layoffs, each with their own requirements for deciding who got the axe? Are the layoffs all occurring at the same time or is each department doing layoffs on their own schedule? These are the sorts of things that ought to be considered when trying to figure out if it is really one big lay off or really several smaller ones.

Read the entire regulation with the examples to get a better idea of what a decisional unit is. You'll find them here: 29 CFR § 1625.22.

If the employer gives the information by department instead of all the departments together and you think the wider group is the correct decisional unit, I'd start by having the employees in each of the units pool the information they get. That should enable them to construct a fairly accurate view of the all the departments together.

But you can't force the company to give it to you the way you want. If you sue the company for ADEA violations, you can in discovery seek documents that the company has about the lay offs from which you may construct the same information for all the units together as best you can, but you cannot force the company to create the specific disclosures that would have been given for the bigger group if those disclosures do not already exist. Discovery only gets you those records that already exist. It does not compel the other party to create documents for you that do not yet exist.

 

[AgedPerson]

But you can't force the company to give it to you the way you want. If you sue the company for ADEA violations, you can in discovery seek documents that the company has about the lay offs from which you may construct the same information for all the units together as best you can, but you cannot force the company to create the specific disclosures that would have been given for the bigger group if those disclosures do not already exist. Discovery only gets you those records that already exist. It does not compel the other party to create documents for you that do not yet exist.

Yes this is in the context of the company asking people to sign a waiver.

I am very familiar with those regulations, hence my question.

In this case the criteria for selection was possibly different for each group, but the layoffs did occur at the same time and were definitely coordinated at the larger group level. The manager at the larger group level was heavily involved in the process, but may have left the exact decision to the individual managers. Based on the regulations you quote and the examples therein, the breaking down of the larger group into smaller units in this case seems to be a clear ADEA violation. That violation may render the waivers to sue void since the terminated employees did not receive the correct information. And yet, from what you have written, aside from suing for a specific claim of age discrinination, there is no way to compell the company to provide the information that is required by law.

So, that portion of the law related to disclosing age information is weak, since there's no specific way to enforce that part of the law in and of itself. Companies can use this process of breaking down large units into smaller units to render data much less statistically meaningful. They can repeatedly do this in violation of the law and there's no specific remedy unless you have reasonable grounds to sue for age related discrimination and force discovery of the data that was supposed to be provided.

It's quite surprising to me that there's a legal requirement that can't be enforced in and of itself.

 

[Tax Counsel]

It's quite surprising to me that there's a legal requirement that can't be enforced in and of itself.

That is not unusual. There are lots of laws and regulations in which some part of it is not separately enforceable or enforceable in a way that you might like

 

[AgedPerson]

It's not a matter of what I like. It seems that the law is designed to provide people with information, but that information can be buried/circumvented via this approach. Perhaps the people who drafted the law had the idea of not having this aspect separately enforceable, but it doesn't seem that was their intent.

Thanks for the information.