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ADEA Regulatory Developments

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On April 19, 2010, SHRM urged the U.S. Equal Employment Opportunity Commission (EEOC) to withdraw a draft rule that would affect an employer’s ability to defend against lawsuits brought under the Age Discrimination in Employment Act (ADEA). 

The ADEA prohibits employers from discriminating against individuals aged 40 and over.  Employers may, however, make decisions that would otherwise be prohibited so long as the differentiation is based on reasonable factors other than age (RFOA). 

In its written comments to the EEOC, SHRM criticized the proposed rule for expanding the definition of “reasonable factors other than age” beyond statutory requirements and current Supreme Court interpretation.

Specifically, SHRM commented that the proposal improperly focuses on whether the employer’s decision-making process was “reasonable” compared against a hypothetical “reasonable employer” facing the same decision, rather than whether the factors actually considered were reasonable. For this reason, SHRM suggested that EEOC withdraw the rule.

Although SHRM argued strongly that the proposed rule should not go forward, SHRM suggested that the EEOC could consider using the rule to form the basis of a compendium of voluntary effective practices for employers to consider when implementing a large-scale reduction in force.

Now that the comment period has closed, EEOC will review all public comment and take final action in the coming weeks.

To read SHRM’s comment, click HERE.


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The next issue of HR Issues Update will be published on Friday, May 14, 2010.
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