Dive Brief:

• An employer's use of year-over-year profit to determine which of its account executives to let go was a nondiscriminatory reason for terminating the employment of the account executive who challenged his firing, the 10th U.S. Circuit Court of Appeals has ruled (Deere v. XPO Logistics Freight, Inc., XPO Logistics Inc., No. 19-1069 (10th Cir. Jan. 9, 2020)).
• William Deere sued XPO Logistics. Inc., claiming age and sex discrimination and retaliation after he was let go from his account executive position during a reduction in force (RIF) and the company allegedly refused to rehire him when he applied for another position. The layoffs were prompted by the company's acquisition of another freight company, and an outside consultant had suggested that year-over-year profit growth be used to determine which account executives should be terminated.
• The appeals court said that Deere did not show pretext in his age discrimination claim. Deere did not dispute that year-over-year profit growth was a non-discriminatory metric for the RIF or that he ranked last in that measure. Instead, he argued that he ranked higher in other metrics. Relying on an earlier decided case, the appeals court noted that the Age Discrimination in Employment Act (ADEA) "does not require [an employer's] business decisions be wise, just nondiscriminatory."

Dive Insight:

Both Title VII of the Civil Rights Act of 1964 and the ADEA protect employees against discrimination. But employers have a strong defense when they can show a nondiscriminatory reason for an adverse employment action. This case illustrates that employers remain free to take adverse employment actions as long as they're based on a legitimate, nondiscriminatory reason. Walmart, for example, recently defeated a former employee's age bias claim after demonstrating it had held multiple employees to the same standard.

Documentation can also be an important element of an employer's defense in a lawsuit. When facing a discrimination or retaliation claim, a lack of documentation can pose a significant problem for employers. An unsuccessful candidate who applied multiple times for a full-time elementary teaching position in her local district was unable to make a case under the ADEA, even though she was older than 40 and passed over twice in favor of younger, less-qualified candidates because the school district was able to show legitimate, nondiscriminatory reasons for choosing the other candidates.

But, as Allison West, principal at Employment Practices Specialists, told attendees at the Society for Human Resource Management's Employment Law and Legislative Conference last year, documentation has to be done right. She suggested manager training on the most common employer documentation mistakes, including no documentation, vague documentation, unclear employee expectations and use of snarky or sarcastic language.