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More Rights for Americans 40+ Cause for celebration or concern?

By Marty Nemko

America was on sound ground as it moved to provide equal opportunity for women, minorities, people over 40, and homosexuals. But, in my view, it started getting into trouble when its goal changed from equal opportunity to equal outcome: a proportionate number of those groups in individual workplaces.

The most visible way the courts have moved us in that direction is by accepting lawsuits solely because an employer’s decision benefits straight white males under 40, even if that occurred unintentionally, the so-called “disparate impact” cases. The latest step in expanding such rights occurred in the just-decided Smith v. City of Jackson, Mississippi case. The court ruled that people over 40 had a basis to sue for discrimination even if there was no intent to discriminate.

For example, let’s say an employer decides to require all its professional-level employees to have a college degree. That will likely have a disparate negative impact on workers over 40 because a generation ago, a smaller percentage of high school graduates went on to college. It will also likely have a disparate impact on minorities because fewer minorities have college degrees. Under the precedent set by Smith vs. City of Jackson, a business could, depending on the judge, be required to prove that requiring a college degree is a business necessity. That’s possible but difficult. Most of us know, subjectively, that college degree holders tend to be more competent, yet prove it? That’s tough especially because a plaintiff’s lawyer could easily parade in expert witnesses who testify that there’s little proof that college education produces much permanent added learning. That attorney would no doubt list the many, many luminaries who succeeded without college from Bill Gates and Michael Dell to Maya Angelou and Woody Allen. So to avoid the problem, an employer might feel the need to stop requiring a college degree and use more subjective and therefore more expensive and perhaps less valid employment selection criteria.

Similarly, an employer requiring employees to have strong computer skills will, in the process, tend to eliminate many older workers. An older worker could then sue. Although no certainty, a judge could require the employer to prove that, in all affected jobs, that high level of computer skills is a business necessity. Provable, but again time consuming, costly, and subject to an opposing attorney’s digging up enough examples where it wasn’t truly “a business necessity” to cast the case into question and force the employer to pay out an expensive settlement. Even if the employer prevailed, the cost and stress of litigation would be burdensome.

The Smith v City of Jackson decision means that now over 75 million workers (over half the nation’s labor force according to the Bureau of Labor Statistics) have special rights to sue simply when an employer makes a decision that inadvertently ends up negatively affecting women, minorities, or people over 40. The Americans with Disabilities Act gives special suing rights to millions of additional employees: from the depressed to quadriplegics to the mentally retarded. The ADA was recently expanded to include, for example, the obese and even the chemically sensitive. Is it unreasonable to predict that other lawyers will attempt to use Smith v. City of Jackson to extend the right to sue for unintentional disparate impact to groups such as the short, bald, cigarette smokers, and the ugly?

It’s tempting to continue expanding the rights of employees, but I fear that the side effect will be too great: boosting the chances that countries such as India and China will decimate our economy. Such countries already have huge advantages: a large, intelligent, and hardworking workforce willing to work for a small fraction of US wages. For example, the average Chinese worker earns just 4 percent of the average American’s earnings. Now, the ever expanding court-ordered rights of US employees are giving a perhaps insurmountable advantage to employers in other countries: the ability to hire, promote, and fire purely on the merits. The result, for increasing numbers of American companies, may be that all categories of US employees will be treated equally: they’ll all be unemployed. (And shareholders broke.)

The courts are ever more insistent that employers hire and promote people whom they otherwise wouldn’t: that’s forced charitable giving. So, is it not possible that the courts or legislatures will eventually pressure employers to give money to other worthy causes: parents who need child care? Whoops, they already do that. Breast cancer? AIDS? The environment? If we keep demanding that employers be ever ”better corporate citizens,” converting them into charitable institutions, they will truly become non-profit, to no one’s betterment.

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